RBI cuts repo rate by 0.25%: Loans may become cheaper, Interest rates reduced after 5 years

New Delhi, 7 February – (DeccanLive.com): The Reserve Bank of India (RBI) has announced a reduction in the repo rate by 0.25%, which could lead to lower interest rates on loans.

Key Details:

• The RBI’s Monetary Policy Committee held an important three-day meeting where significant decisions were made.
• RBI Governor Sanjay Malhotra announced that the repo rate has been reduced by 25 basis points (bps), bringing it down to 6.25%. This marks the first such cut since the COVID-19 pandemic in 2020.
• Malhotra highlighted that the inflation target has positively impacted India’s economy, which remains strong. He also emphasized stakeholder consultations for future policies.
• The RBI has projected a GDP growth rate of 6.7% for the next financial year. Additionally, food inflation is expected to ease with the arrival of the new harvest.

Impact on Loans:

• With this decision, banks are likely to reduce interest rates on various loans, including home loans, car loans, education loans, corporate loans, and personal loans.