Reserve Bank Of India / Loans will become cheaper, after 5 years RBI cuts repo rate by 0.25%, EMI will decrease

Reserve Bank Of India: Giving a big relief to crores of people of the country, the Reserve Bank of India (RBI) on Friday announced a cut in the repo rate by 0.25 percent. After this decision, the repo rate has come down from 6.50 percent to 6.25 percent. This important decision was taken after a three-day meeting of the RBI's Monetary Policy Committee (MPC). This cut has been made after about 56 months, which is expected to reduce the EMI of home loans, car loans and other loans.

Effect of repo rate cut

The biggest benefit of this cut will be to those who have taken home loans or other types of loans. Banks will now be able to provide loans at cheaper rates, which will ease the burden of monthly EMI of the general public. This will also boost the real estate and automobile sectors, as low interest rates will encourage more people to take loans.

Relief came after 56 months

The RBI had earlier cut interest rates in May 2020, when the country's economy was negatively affected due to Kovid-19. At that time, the RBI had cut the repo rate by 0.40 percent to support the economy. After this, interest rates were increased marginally in February 2023, but there was no change since then.

First big announcement of RBI Governor Sanjay Malhotra

This decision was taken in the first monetary policy meeting of the new RBI Governor Sanjay Malhotra. He has given relief to the general public through this decision, which has also received a positive response from the government and the industry.

Long-standing demand of the government and the general public

For the past few months, the demand for a cut in interest rates was increasing continuously. There was also pressure on the government in this direction, so that economic activities could get more encouragement. Now this cut will increase the cash flow in the markets, which will increase consumer spending and investment.

Future prospects

Economic experts believe that if the inflation rate remains under control, RBI may make further cuts in the coming months. This will also keep the loan EMIs likely to reduce further. Apart from this, the main objective of the central bank's policy is to maintain economic growth while keeping inflation under control.

Conclusion

This decision of RBI will strengthen the country's economy and the general public will experience financial relief. The reduction in interest rates will not only benefit consumers but will also boost various industries. This decision is a positive sign for future economic policies, which will accelerate the economic development of the country.

#WATCH | Making a statement on Monetary Policy, RBI Governor Sanjay Malhotra says, "The Monetary Policy Committee unanimously decided to reduce the policy rate by 25 basis points from 6.5% to 6.25%..."

(Source - RBI) pic.twitter.com/wIOOfpAwS4

— ANI (@ANI) February 7, 2025