RBI cuts repo rate by 25 bps

The Reserve Bank of India and the Monetary Policy Committee (MPC) during its first bi-month monetary policy meeting on Thursday cut the benchmark repo rate by 25 basis points (bps) to 6.00 per cent. The central bank expressed that it doesn't expect inflation to cross 3.8 per cent in FY20.

The RBI adjusts the reverse repo rate to 5.75 per cent and MSF, bank rate adjusts to 6.25% per cent

The committee has kept the policy stance unchanged at 'neutral’. The MPC voted 5:1 in favour of keeping the stance unchanged. While the MPC members voted 4:2 in favour of a 25 bps rate cut. Viral Acharya voted against a rate cut.

RBI Governor Shaktikanta Das stated that India's GDP is expected to be at 6.8-7.1 per cent in H1FY20 and at 7.3-7.4 per cent in H2FY20.

After the rate cut announcement, the benchmark indices derailed further and the BSE Sensex was at 38,740.36, down by 136.76 points or 0.35 per cent at 11:54 hours, while the Nifty50 was trading 11,616.50, down by 27.45 points or 0.24 per cent and Nifty Bank was quoting 30,021.45 , down by 71.85 points or 0.24 per cent.