RBI Set to Cut Rates Tomorrow: Finance Minister Sitharaman Sends Crucial Message to MPC

With expectations of a 25 basis-point rate cut for the first time in years, Finance Minister Nirmala Sitharaman has sent a message to the Monetary Policy Committee, which began deliberations on Wednesday. 

Malhotra has more reason to support a rate cut after data revealed a sharper-than-expected economic slowdown, and US President Donald Trump's new tariff threats unsettled global markets. If the RBI cuts rates this week, it would come after Prime Minister Narendra Modi’s budget included record tax cuts of $12 billion to boost the economy.

Raoul Kapoor, Co-CEO, Andromeda Sales and Distribution,

A rate cut by the RBI has been long anticipated, but in the last monetary policy meeting, instead of reducing the repo rate, the central bank opted to lower the Cash Reserve Ratio (CRR). This move provided some relief by injecting liquidity into the market. However, given the current domestic and global economic conditions, there is strong anticipation of a repo rate cut of 25 to 50 basis points in tomorrow’s MPC meeting.

Sahil Agarwal, CEO, Nimbus Group,

A modest 25 bps rate cut in tomorrow’s monetary policy meeting seems highly likely, given the pressures on GDP growth, inflation remaining within a comfortable range for the past few quarters, and prevailing tight liquidity conditions. Additionally, global factors such as trade dynamics and financial market trends further support the case for a rate reduction.

A rate cut would not only enhance liquidity but also stimulate consumption and purchasing power, ultimately fueling economic growth. Lower borrowing costs could give significant boost to the real estate sector, as reduced home loan interest rates serve as a major incentive for prospective homebuyers. This, in turn, could drive higher demand for housing, benefiting both end-users and investors alike.