• RBI Reduced Policy Repo Rate from 6.50% to 6.25% in recent Monetary Policy.
• You can see the revised rates as follows:
• Standing Deposit Facility Rate is reduced from 6.25% to 6.00%
• Marginal Standing Facility rate is reduced from 6.75% to 6.50%
• Bank rate is reduced from 6.75% to 6.50%
• The CRR and SLR rates remain unchanged. However, CRR rate was reduced in previous Monetary policy form 4.50% to 4.00%, providing more liquidity in the market.
• This redcued rate in Bank rates will also benefit people who have taken loans, they will possibly get 0.25% reduction in interest rates on their loans, depending on whether they had flexible rate Loans or fixed rate loans.
• EMIs in Home Loans and Vehicle loans will also come down making it easier for people to repay them.
• A lower Repo rate will also lead to lower Interest rates loans for Businesses and Companies leading to higher Growth in Businesses later.
• However more liquidity in the market can potentially lead to higher inflation rates as well, which RBI will have to be cautious about in upcoming months.
• Finanlly, RBI has projected GDP growth rate for FY26 (2025-2026) to ~6.7%
