RBI’s big announcement on 6 June! Will home-car loan be cheap, know what are the expectations?
Reserve Bank of India Governor Sanjay Malhotra will announce the monetary policy to be held every two months on Friday i.e. on June 6 at 10 am. Everyone’s eyes will be on the announcements to be made tomorrow. It is expected that there may be an announcement to cut policy rates from 0.25 percent to 0.50 percent. According to PTI news, experts say that the central bank can cut interest rates to promote economic growth in the background of trade tension arising from Trump’s tariff. RBI’s Rate-Development Committee Monetary Policy Committee (MPC) has started three days of discussions on Wednesday.
What will be a cut of 0.50%?
According to the news, on the recommendations of MPC, the central bank had cut 25 basis points in the major benchmark borrowings (repo) in February and April this year. Most experts believe that the RBI will also cut 25 basis points in repo this time, although a research report by State Bank of India (SBI) has said a large rate of 50 basis points. Reduction in repo rate reduces borrowing rates by banks, which in turn reduces EMI for retail and corporate borrowers.
Most banks have taken this initiative
According to an RBI assessment, most banks have reduced the marginal cost of their repo-linked external benchmark-based lending rates (EBLR) and fund-based lending rates (MCLR) since February 2025, in response to a 0.50 percent reduction in policy repo rate since February 2025. Reduction in repo rate reduces borrowing rates by banks, which in turn reduces EMI for retail and corporate borrowers. MPC consists of three members of RBI and three external members appointed by the government.
Who are six members in MPC
RBI members are: Governor Sanjay Malhotra, Deputy Governor M Rajeshwar Rao and Executive Director Rajiv Ranjan.
External members are: Nagesh Kumar, Director and Chief Executive Institute Institute, New Delhi; Shri Saugat Bhattacharya, Economist, Mumbai; And Professor Ram Singh, Director, Delhi School of Economics, Delhi.
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