Mumbai: The Reserve Bank of India (RBI) is widely expected to announce a 25 basis point (bps) Repo Rrate cut during its upcoming Monetary Policy Committee (MPC) meeting scheduled for Friday, June 7, according to a consensus among economists and financial market experts.
If implemented, this would mark the third consecutive Repo Rate cut by the central bank in 2025, continuing its policy easing stance aimed at supporting economic growth amid moderating inflation and weak demand indicators.
Analysts believe that falling retail inflation, a sluggish rural recovery, and global rate-cut trends are giving the RBI enough room to act. The repo rate currently stands at 6.00%, and a cut would bring it down to 5.75%—levels not seen since early 2023.
“We expect a 25 bps cut as part of a proactive growth-supportive strategy. Inflation has remained within the RBI’s comfort zone, and global central banks are also leaning toward easing,” said a senior economist at a leading financial institution.
Some experts, however, caution that the central bank may adopt a “wait-and-watch” tone post-cut, keeping an eye on monsoon performance, food inflation, and US Federal Reserve decisions before committing to further rate reductions.
The RBI’s decision will also be closely watched by the equity and bond markets, as investors anticipate how far and how fast the central bank may go in loosening policy in the months ahead.