Overview

• The Monetary Policy Committee delivered a third straight rate cut by reducing the policy repo rate by 50 basis points to 5.5 percent on June 6.
• Officials changed the policy stance from accommodative to neutral to allow for careful assessment of incoming growth and inflation data.
• A 100 basis point cut in the Cash Reserve Ratio to 3 percent, to be implemented in four tranches, is projected to release about Rs 2.5 lakh crore of liquidity by December 2025.
• Inflation forecasts for fiscal 2025–26 were revised down to 3.7 percent from 4 percent, while the GDP growth projection remained unchanged at 6.5 percent.
• RBI says these measures aim to lower borrowing costs and support credit expansion as global trade tensions and economic uncertainties persist.