The Reserve Bank of India (RBI) has reduced the repo rate by 25 basis points (bps), bringing it down
to 6.25%. This marks the first rate cut in nearly five years. Previously, the rate cut happened in
March 2020 when it was brought down by 75 basis points to 4.40%.
RBI Governor Sanjay Malhotra announced the decision, which was made during the 3-day Monetary
Policy Committee (MPC) meeting held from February 5, 2025, to February 7, 2025.
He stated,
“The Monetary Policy Committee unanimously decided to reduce the policy rate by
25 basis points from 6.5% to 6.25%!”
As a result, the standing deposit facility (SDF) rate has been revised to 6.00%, while both the
marginal standing facility (MSF) rate and the Bank Rate have been adjusted to 6.50%.