RBI Cuts Rates Amid Global Economic Turbulence

The Reserve Bank of India (RBI) slashed interest rates by 50 basis points, marking the third consecutive cut, while also reducing the cash reserve ratio. These measures aim to inject liquidity into the economy, countering geopolitical challenges and spurring domestic growth amidst global uncertainties and tariff tensions.

The Reserve Bank of India (RBI) took decisive action by lowering interest rates by 50 basis points, the third such reduction in a string of cuts aimed at bolstering an economy facing global challenges. Additionally, the cash reserve ratio was reduced to infuse liquidity into the banking system.

Under the leadership of Governor Sanjay Malhotra, the RBI's monetary policy committee voted overwhelmingly to implement the rate cuts, also transitioning its stance from 'accommodative' to 'neutral'. This comes as inflation has cooled significantly, but economic growth remains below expectations.

By injecting Rs 2.5 lakh crore into the system, the RBI hopes to stimulate domestic consumption and investment. The decision underscores a focus on maintaining price stability while fostering a conducive environment for growth, as the country grapples with external trade tensions and internal economic challenges.

(With inputs from agencies.)