{"id":275356,"date":"2025-04-06T10:19:46","date_gmt":"2025-04-06T10:19:46","guid":{"rendered":"https:\/\/news.talkwithrattan.com\/index.php\/2025\/04\/06\/rbi-likely-to-cut-rates-by-25-bps-on-april-9-say-experts-the-times-of-india\/"},"modified":"2025-04-06T10:19:46","modified_gmt":"2025-04-06T10:19:46","slug":"rbi-likely-to-cut-rates-by-25-bps-on-april-9-say-experts-the-times-of-india","status":"publish","type":"post","link":"https:\/\/news.talkwithrattan.com\/index.php\/2025\/04\/06\/rbi-likely-to-cut-rates-by-25-bps-on-april-9-say-experts-the-times-of-india\/","title":{"rendered":"RBI likely to cut rates by 25 bps on April 9, say experts – The Times of India"},"content":{"rendered":"
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RBI Governor Sanjay Malhotra (File photo)<\/span><\/div>\n<\/section>\n<\/div><\/div>\n<\/div>\n

The Reserve Bank of India<\/a> (RBI) is expected to cut key interest rates by up to 25 basis points this week, with lower inflation supporting an accommodative monetary policy stance.
This move is also seen as necessary to stimulate growth amidst global economic challenges, including the tariffs announced by the United States, as per PTI report.
In February, the RBI\u2019s Monetary Policy Committee (MPC), led by Governor Sanjay Malhotra, reduced the repo rate<\/a> by 25 basis points to 6.25%, marking the first rate cut since May 2020.
The 54th meeting of the MPC is set to begin on April 7, with the official announcement scheduled for April 9. The RBI had kept the repo rate at 6.5% since February 2023, after a series of rate hikes that followed the reduction during the COVID-19 pandemic in May 2020.
Global and domestic factors at play<\/span>
Madan Sabnavis, Chief Economist at Bank of Baroda, highlighted the significance of this policy announcement, noting the global economic uncertainties, particularly the tariffs recently imposed by the US. These tariffs, ranging from 11-49% on approximately 60 countries, including India and China, are set to take effect on April 9. Sabnavis pointed out that these developments could impact India\u2019s growth and currency, factors that the MPC will need to consider alongside its standard economic assessments.
Experts predict that with inflation under control and liquidity stabilized, the conditions seem favourable for another 25 bps rate cut. Additionally, there is speculation that the RBI may shift its stance to “accommodative,” suggesting that further rate cuts could follow later in the year.
The tariff impact and India\u2019s export landscape<\/span>
The US’s imposition of tariffs is seen as both a challenge and an opportunity for India, as its competitors in export markets\u2014such as China, Vietnam, Bangladesh, Cambodia, and Thailand\u2014will face higher duties. This scenario could benefit Indian exports by making goods from these countries more expensive on the global market.
Rating agency Icra also forecasts a 25 bps rate cut in the upcoming MPC meeting, while maintaining a neutral stance on future policy. Icra suggests that RBI\u2019s liquidity interventions will likely continue, especially to offset potential impacts from the unwinding of short positions and the maturity of long-term Variable Rate Repos (VRRs).
Industry opinions<\/span>
Meanwhile, industry body Assocham has called for a more cautious approach, recommending a “wait-and-watch” stance rather than an immediate rate cut. Assocham President Sanjay Nayar emphasized that recent RBI liquidity measures should first be allowed to take effect, particularly in supporting capital expenditure growth and consumption. Despite global challenges, Nayar expects India\u2019s GDP to grow at a healthy 6.7% in FY26, with retail inflation remaining under control.
Retail inflation, which fell to a seven-month low of 3.61% in February, largely due to falling prices of vegetables and proteins, has created room for the RBI to consider further rate reductions. This follows inflation rates of 4.26% in January and 5.09% in February 2024.
Impact on housing and consumption<\/span>
Pradeep Aggarwal, Founder and Chairman of Signature Global (India) Ltd, predicted that the RBI might cut the repo rate by 25 basis points, bringing it down to 6%. Aggarwal believes that such a move would boost consumption by encouraging more borrowing, particularly in the housing market. A lower repo rate typically reduces borrowing costs, spurring demand for homes and investment in the real estate sector. However, the true effect of this rate cut will depend on how promptly commercial banks pass on the RBI\u2019s policy changes to consumers.
The MPC’s decision will ultimately be influenced by a combination of domestic economic conditions and external pressures, with the RBI likely balancing its efforts to stimulate growth while keeping inflation in check. The outcome of the meeting on April 9 will shed light on the central bank’s approach moving forward.<\/div>\n