NEW DELHI — The Reserve Bank of India (RBI) lowered its key repo rate on Friday for the first time in nearly five years, signaling a shift toward a more accommodative policy stance as it seeks to bolster the country’s slowing economy.
The Monetary Policy Committee (MPC), composed of three RBI officials and three external members, cut the benchmark rate by 25 basis points to 6.25%, following eleven consecutive meetings in which it remained unchanged.
The move, widely anticipated by economists, was in line with a Reuters poll in which more than 70% of respondents had predicted a quarter-point reduction. It marked the first cut in India’s key interest rate since May 2020.
Following the announcement, India’s benchmark 10-year bond yield rose five basis points to 6.70%, while the rupee and major equity indexes weakened slightly.
