Sanjay Malhotra Hails Union Budget and Announces Repo Rate Cut

New RBI Governor Sanjay Malhotra commended the Union Budget for FY26, highlighting its potential for economic growth and inflation control. The budget's Rs 1 lakh crore tax relief aims to boost consumption without major inflationary effects, alongside a 0.25% repo rate cut, the first in five years.

On Friday, Sanjay Malhotra, the newly appointed Governor of the Reserve Bank of India, praised the Union Budget for FY26 as a significant step toward economic growth and inflation control. He emphasized the government's efforts to provide Rs 1 lakh crore in tax relief to the middle class, which will stimulate consumption without exacerbating inflation.

Malhotra, who took office in December, also announced a 0.25% reduction in the repo rate, marking the first such monetary easing by the RBI in five years. He credited the budget for maintaining the fiscal deficit at 4.4%, slightly below the previously projected 4.5%, achieving this through strategic measures.

The budget's focus on vegetables, fruits, and pulses is seen as a crucial move to manage consumer price inflation, which is significantly influenced by food prices. Malhotra assured that the fiscal policies, coupled with optimal production capacity, will meet the demand surge, minimizing any inflationary risk.