Repo rate was last cut in May 2020
RBI Repo Rate: Reserve Bank of India Governor Sanjay Malhotra announced a reduction of 0.25 percent (25 basis points) in the repo rate on Friday, February 7. After this cut, the repo rate will be 6.25 percent. The Reserve Bank last changed the repo rate in June 2023. The RBI raised the repo rate to 6.5 percent in June 2023. There was no change in the repo rate since June 2023. For the first time today, the repo rate has been changed after June 2023 and now it has been reduced from 6.50 percent to 6.25 percent.
Repo rate was last cut in May 2020
IBI last cut interest rates in May 2020. At that time, the RBI had cut 0.40 percent (40 basis points) in the repo rate to boost the country’s economy during Kovid. After which today, after about 5 years, the repo rate has been cut in any way. It was decided to reduce the repo rate in the MPC meeting from 5 February to 7 February 2025. This was the first MPC meeting of Sanjay Malhotra, appointed Governor of RBI on 11 December last year.
Who will benefit and who will be harmed
This decision of RBI will make home loan and car loans cheap and loans of crores of borrowers will decrease. That is, people whose loan is going on will get a lot of relief from this decision of RBI. However, there is also a class who will have to lose this decision. Yes, due to the reduction in repo rate, where the loan will become cheaper on one side, on the other hand, the interest on FD i.e. fixed deposits will also be reduced. That is, people who are not having any loan and they invest in FD will have to lose this decision.
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