Overview
- The policy repo rate stands at 5.25% after the December 25-basis-point reduction, taking cumulative easing since February to 125 bps.
- Governor Sanjay Malhotra argued real rates should be lower given subdued headline and core inflation, with CPI hitting 0.3% in October and 0.71% in November.
- While Q2 GDP grew 8.2%, members flagged weakening high-frequency indicators and external trade headwinds that could slow momentum in the second half of the fiscal year.
- The MPC voted 5–1 to keep a neutral, data-dependent stance, with one member urging a shift to accommodative and others judging policy now balanced.
- Separately, the RBI board approved a move to risk‑based deposit‑insurance premia from the next financial year, and market reports noted rupee weakness after the cut, including a record 91.08 per dollar.