Rbi mpc meet: The Six -member Monetary Policy Committee (MPC) meeting of the Reserve Bank of India (RBI) started on Monday 7 April. This meeting is the first review meeting of the current financial year 2025-26 (FY26). The central bank will announce the results of the MPC meeting on Wednesday 9 April. Among the ‘mutual tariff’ imposed by US President Donald Trump, the policy repo rate is likely to be cut by 25 basis points. However, there is a possibility of further cuts. Meanwhile, the global brokerage house Nuwama has also estimated a cut of 25 basis points in the repo rate.
Repo rate reduction of 25 basis points possible
Brokerage house Nuwama said, “We hope that MPC will cut the repo rate in the upcoming monetary policy review of 25 basis points and will change the monetary trend from” neutral “to” satisfactory “.” Nuwama said that in the midst of the global trade war, the threat of global economic recession is increasing, which may further worsen the situation of weak demand in the country.
In inflation rate control
Nuwama said in his report that in February 2025 the main inflation rate was 3.6% on an annual basis, below the target level – which gives RBI enough space to cut rates. In addition, reducing the return on bonds in G-7 countries will provide additional assistance to policy makers.
In this context, the recent steps taken by the RBI, such as providing liquidity and relaxing regulatory restrictions, are welcome, but their full impact will be achieved only when they will be combined with cuts in interest rates to limit the recession in the domestic economy. The market will closely monitor the further guidance of the MPC.
RBI expected to cut interest rates
Shishir Baijal, Chairman and Managing Director of Knight Frank India, while giving his views on the upcoming monetary policy committee (MPC) meeting, said that he hoped that the RBI would cut the repo rate by 25 basis points and bring it to 6%. He said that retail inflation has reached a seven -month low in February 2025 and the speed of domestic consumption is also slowing down. In such a situation, there is a possibility of cutting interest rates.
Baijal said that the recent recent RBI in the rupee against the US dollar has given the RBI additional flexibility to cut the interest rates, which gave relief from the large scale of foreign capital without going out on a large scale.
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