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EMIs to go down as RBI cuts repo rate by 25 basis points

The repo rate, at which the the central bank lends to the system, will come down to 5.75 per cent after the cut.

PTI PTI
New Delhi Updated on: June 06, 2019 13:24 IST
RBI cuts interest rates for third time this year to boost

RBI cuts interest rates for third time this year to boost growth

Slashing benchmark lending rates for the third time this year, the Reserve Bank of India cut its repo rate by 0.25 per cent Thursday and said its future monetary policy stance will be more accommodative. The latest decision by the RBI is likely to have an impact on customers with EMIs likley to go down. 

Amid concerns of a slow down in the economy, the central bank lowered its gross domestic product (GDP) forecast to 7 per cent for the current fiscal from 7.2 per cent projected earlier.

The repo rate, at which the central bank lends to the system, will come down to 5.75 per cent after the cut.

While marginally increasing its inflation projection to 3-3.1 per cent for the first half of the fiscal year 2019-20, which is within the comfort range of 2-6 per cent set by the government, RBI cut the GDP growth targets sharply to 7 per cent for FY20 on weak global scenario and dip in private consumption.

"The MPC (monetary policy committee) notes that growth impulses have weakened significantly… A sharp slowdown in investment activity along with a continuing moderation in private consumption growth is a matter of concern," read the policy resolution.

Also Read: RBI rate cut unlikely to stimulate growth due to poor transmission: India Ratings and Research

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