RBI MPC: Repo rate down to 6.50% to 6.25% after five years; Announcement of new Governor Sanjay Malhotra
New Delhi| The RBI Governor announced after the MPC meeting that the repo has been cut by 25 basis points. This has been reduced from 6.5% to 6.25%. RBI Governor said that all the members of MPC have voted in favor of rate cut.
What else did Sanjay Malhotra say on MPC’s decisions?
As Governor, Sanjay Malhotra announced the decision of the Monetary Policy Committee for the first time. During his speech he said that the inflation rate is close to the target. Flexible inflation target has had a better impact on the economy. According to RBI Governor Sanjay Malhotra, the inflation rate is close to the target. This has had a better impact on the economy. He said that monetary policy has still been kept neutral. RBI Governor announced the decision on interest rates after a three-day meeting.
There will be changes in the framework related to inflation target
RBI Governor has said that we are trying to keep the regulation balanced. There will also be a change in the framework related to inflation target. The new rules will be implemented in a phased manner. Negotiations on the Regulation on the parties concerned will continue.
Decision announced after three-day MPC meeting
Reserve Bank of India (RBI) announced the new Governor of Reserve Bank Sanjay Malhotra Monetary Policy after the Monetary Policy Committee (MPC) meeting of 7 February 2025. Market experts expected that this time the repo rate could be cut by 25 basis points to 6.25 per cent.
Repo rate changes for the first time since February 2023
From February 2023, the repo rate was kept stable at 6.5 percent. Earlier in 2020, interest rates were cut during the Covid pandemic, but after this, tax interest rates were gradually increased by 6.5 percent. The repo rate cut has been announced after a long time. This will provide relief to the common man in EMI of home loan, vehicle and personal loan. Cheap loans will reduce the EMI burden on people.
What is the impact on your home loan EMI from the 25 basis point deduction?
If someone has taken a loan of Rs 50 lakh at an interest rate of 8.5 per cent for 20 years and if RBI announces a deduction of 0.25 per cent then his EMI will be reduced, such as the old interest rate of Rs 43,391 at 8.5 per cent, and the new interest after deduction of interest rates will be Rs 42,603 at 8.25 per cent, In which there will be savings of Rs 788 per month and savings of Rs 9,456 per year. If you have taken a car loan of Rs 5 lakh at an interest rate of 12 per cent then Rs 11,282 has to be paid on the old EMI, if there is a deduction then the new EMI of the car loan will be Rs 11,149. In which there will be savings of Rs 133 per month and Rs 1,596 over the year.
