Big news is coming for the middle class! In the current economic situation, controlling inflation and reducing loan interest rates are very important. Recently, a research firm stated that the Reserve Bank of India may cut the repo rate by 0.25% in the first week of April during its monetary policy committee meeting. If this happens, interest rates on home loans, car loans, and other loans will decrease significantly, which is great news for the middle class.

What is the Repo Rate, and How Will Its Reduction Help?

The repo rate is the interest rate at which state-owned banks in India borrow money from the Reserve Bank of India (RBI). When the RBI lowers this rate, banks can also offer loans at lower interest rates. This means that people taking loans will have to pay less interest.

If the repo rate is reduced, interest rates on home loans, car loans, and personal loans will decrease significantly. It will also become easier for businesses to get loans. As a result, inflation will be reduced slightly, and economic growth will improve.

Why is RBI Planning to Cut the Repo Rate?

A report suggests that inflation may drop to 4.7% in the financial year 2025-26, which is within the RBI’s target range. To boost economic growth, the RBI is looking to lower interest rates and make investment easier. The RBI’s Monetary Policy Committee will meet from April 7 to 9, and a decision on reducing the repo rate may be taken.

How Many Times Will the Repo Rate Be Cut in 2025-26?

Sources say that the RBI may reduce the repo rate by a total of 0.75% in three phases by 2025-26. By February 2026, the repo rate could drop to 5.5%, which is great news for the middle class. Experts believe that if there are no major global market changes, the RBI may further cut interest rates in stages, providing more relief to the public.

If the RBI decides to reduce the repo rate in April, it will be great news for those planning to take a loan or reduce their debt burden. In simple words, it will be a golden opportunity for many.