RBI Cuts Repo Rate by 50 Basis Points: What It Means for Borrowers
In a significant move aimed at stimulating economic growth, the Reserve Bank of India (RBI) has announced a reduction in the repo rate by 50 basis points, bringing it down from 6% to 5.50%. This decision, effective from Friday, marks the third rate cut this year, as confirmed by RBI Governor Sanjay Malhotra. The reduction is expected to ease borrowing costs for consumers and businesses alike, providing a much-needed boost to the economy.
Previously,the RBI had lowered the rate by a total of 50 basis points in February and April,with each cut being 25 basis points. The repo rate is the interest rate at which the RBI lends to commercial banks,and a decrease in this rate typically leads to lower interest rates on various loans,including home and auto loans. Consequently,borrowers can expect some relief in their monthly repayments,making it an opportune time for those considering loans. This strategic move by the RBI reflects its commitment to fostering economic stability and growth, especially in the face of ongoing global uncertainties.
