RBI revises repo rate by 50 basis points, cuts CPI inflation to 3.7%

The Reserve Bank of India has revised its inflation outlook for 2025-26 downwards from the earlier forecast of 4 per cent to 3.7 per cent and stated that CPI headline inflation continued its declining trajectory in March-April, with headline CPI inflation moderating to a nearly six-year low of 3.2 per cent (year-on-year) in April 2025.

This was led mainly by food inflation, which recorded the sixth consecutive monthly decline. Core inflation remained largely steady and contained during March-April, despite increase in gold prices exerting upward pressure.

Join PSU Connect on WhatsApp now for quick updates! Whatsapp Channel

Read Also : Dhanlaxmi Bank Appoints Ashutosh Khajuria as Independent Director

According to the provisional estimates released by the National Statistical Office (NSO) on May 30, 2025, real GDP growth in Q4:2024-25 stood at 7.4 per cent as against 6.4 per cent in Q3. On the supply side, real gross value added (GVA) rose by 6.8 per cent in Q4 FY25. For 2024-25, real GDP growth was placed at 6.5 per cent, while real GVA recorded a growth of 6.4 per cent.

Read Also : Goa Shipyard backed Fifth FPV ‘Achal’ Launched for ICG

Meanwhile, after assessing the current and evolving macroeconomic situation, the MPC voted to reduce the policy repo rate by 50 basis points (bps) to 5.50 per cent with immediate effect. Consequently, the standing deposit facility (SDF) rate under the liquidity adjustment facility (LAF) shall stand adjusted to 5.25 per cent and the marginal standing facility (MSF) rate and the Bank Rate to 5.75 per cent.

This decision is in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth.

Read Also : HPCL signs MoU with Snap-E Cabs for HP e-Charge Facility