New Delhi:
The Monetary Policy Committee – MPC of RBI has cut 25 basis points (BPS) in the repo rate. Let us know that RBI has announced the cut after 5 years. After which the repo rate was reduced to 25 basis points to 6.25%. This decision of RBI is expected to provide relief to the general public and business sector.
The RBI Monetary Policy Committee (MPC) cut the repo rate by cutting 25 basis points (BPS) to 6.25%. Earlier, RBI did not make any changes in interest rates in 11 consecutive meetings. Earlier in May 2020, the repo rate was reduced during the Kovid-19 epidemic.
Now what will be the effect on EMI?
This decision was taken in the monetary policy meeting chaired by the new RBI Governor Sanjay Malhotra. Due to decrease in interest rates, home loan, car loan and business loans will become cheap.
The repo rate is the rate on which banks take loans from RBI. If the repo rate decreases, banks can also give loans to customers at cheap interest rates. This is likely to reduce the EMI of home loan, car loan and business loan. However, it depends on banks when and how much they will benefit customers.
Economic growth rate for FY26 increased estimates
RBI Governor Sanjay Malhotra said that inflation has declined and it is expected to continue further. At the same time, RBI has increased India’s economic growth rate for FY26 from 6.6% to 6.7%.
Inflation estimated to be 4.2% in FY 2025-26
The Reserve Bank of India (RBI) has estimated the inflation to be 4.2% in the upcoming financial year 2025-26. RBI has divided this estimate of inflation for FY26 into four quarters. Inflation in April-June is estimated to be 4.5%, it can be reduced by 4% in July-September and reduced in October-December It is expected to be 3.8%.
RBI said that it will adopt “neutral stance”, that is, the policies can change even further according to the need.
Why the interest rate reduced?
RBI took this decision because inflation is decreasing and there is a possibility of further decrease next year. Rural demand (rural demand) is increasing, which will give support to the economy. Urban demand (urban demand) remains a bit sluggish, but is expected to improve.
What will you benefit from this decision?
- Home loan and car loans can be cheap: Banks can now cut interest rates, which can reduce EMI.
- Business loans will also affect: Companies will get cheaper, which will give a boost to business.
- Economy will get boost: People will spend more at a low interest rate, which will benefit the market and business.
“Cyber fraud is a matter of serious concern, needs to take action immediately”
RBI Governor Sanjay Malhotra said that with the digitization of financial services, cyber risk is also increasing, which is a serious concern and all stakeholders will have to take immediate action on it. Banks have to develop better reaction and recovery system to deal with cyber fraud. Apart from this, a working group will be formed to review trading and settlement timing in the market. To further strengthen cyber security, an exclusive bank.in domain will be brought to Indian banks, whose registration will start from April this year and will help control online fraud.