The Monetary Policy Committee of the Reserve Bank of India is expected to cut the policy repo rate by 25 basis points on June 6, marking the third consecutive reduction in 2025. With headline inflation undershooting forecasts and growth indicators showing uneven traction, the central bank is likely to act pre-emptively. Polls conducted by leading financial publications and agencies point to a consensus expectation of a rate cut this Friday.The key reason for the expectation is the favourable inflation backdrop and the need to support growth in view of the rising external uncertainty. Some voices in the policy and research community, including SBI Research, have gone further to advocate a larger 50 bps cut, arguing that a bolder move may be necessary to stimulate the credit cycle and sustain growth momentum.
.png)
