RBI cuts rates by 0.25% to support growth

The Reserve Bank on Friday cut its key rates by 0.25 percent to boost the economy from a six-year low saying reduction was necessary to revive growth. With first-quarter GDP growth plunging to 5 percent, the RBI cut its estimate of economic growth in the current fiscal to 6.1 percent from its earlier estimate of 6.9 percent.

The repo rate, at which it lends to the system, has been brought down to 5.15 percent to help reduce borrowing costs for home and auto loans, which are now directly linked to this benchmark. This is the fifth straight cut in rates by the Reserve Bank in its key rates in as much policy reviews in 2019 and takes the total quantum of reductions to 1.35 percent.