RBI MPC June 2025: Good news for borrowers as RBI cuts repo rate by 50 bps to 5.50%

In a significant move that is set to ease the financial burden on borrowers, the Reserve Bank of India (RBI) has announced a reduction in the repo rate by 50 basis points, bringing it down to 5.50%. This decision, taken during the Monetary Policy Committee (MPC) meeting in June 2025, is aimed at stimulating economic growth by making borrowing cheaper for individuals and businesses alike. The cut in the repo rate, which is the rate at which the RBI lends money to commercial banks, is expected to lead to lower interest rates on loans, including home and auto loans. This reduction is a strategic response to current economic conditions, as the central bank seeks to bolster consumer spending and investment by reducing the cost of credit. Economists suggest that this move could provide a much-needed boost to sectors struggling with high borrowing costs. Market analysts are optimistic about the potential positive impacts of this rate cut on the broader economy. By making loans more affordable, the RBI's decision is likely to encourage increased borrowing, thereby driving consumption and investment. This, in turn, could help in revitalizing various industries and potentially lead to job creation, offering a brighter economic outlook for the coming months.

— Authored by Next24 Live