RBI's Rate Cut: A Boost to Economic Growth

The Reserve Bank of India has announced a reduction in the benchmark lending rate by 25 basis points, which is welcomed by banks as a move to spur growth and complement budget announcements. The RBI also postponed the revised liquidity coverage ratio, signaling a cautious approach to regulatory changes.

The Reserve Bank of India's decision to cut the benchmark lending rate by 25 basis points has been met with approval from bankers, who see it as a catalyst for economic growth and a complement to the recent budget announcements.

The announcement also included a delay in implementing the revised liquidity coverage ratio, a move bankers believe gives them more time to adapt to new regulations. This deferment is seen as providing banks the flexibility needed to align with the new guidelines, which are now set for March 31, 2026.

Leaders from various banks, including SBI and Standard Chartered, praised the decision, anticipating that this could mark the beginning of a rate-cutting cycle that will foster credit expansion and support economic recovery in a challenging global environment.

(With inputs from agencies.)