*RBI-MPC | Updates | 7.2.2025!* • Repo Rate: 6.25% • Reverse Repo Rate: 3.35% • SDF: 6.00% • MSF: 6.50% • CRR: 4.00% • SLR: 18.00% • GDP forecast for FY26: 6.7% • CPI forecast for FY25: 4.8% ; FY26: 4.2% *Key Highlights:* • RBI and MPC will continue to improve macroeconomic outcomes. • Inflation targeting has served Indian economy very well. • We will continue to strengthen, rationalise and refine the prudential framework. • Average inflation has remained lower since introduction of monetary policy framework. • Food inflation expected to soften on the back of new crop arrival. • Mining and electricity are rebounding, business expectations remain upbeat as indicated by PMI numbers. • Economic interest also warrants efficiency in economy, we recognise this. • Indian economy remains strong, though not immune to global challenges. • Economic activities are expected to improve in the current year, while agricultural activities remain upbeat, and manufacturing activities are expected to improve gradually. • Monetary Policy Committee announces Repo Rate cut for the first time in 5 years. Repo Rate cut by 25 bps to 6.25%. • Consequently, the Standing Deposit Facility (SDF) rate shall be at 6.0% and the Marginal Standing Facility (MCF) rate and the bank rate shall be 6.5%. • MPC unanimously continues with 'neutral' stance. •Big relief for home loan borrowers as EMIs to fall by 3.5% on a 20 year loan tenure as RBI reduced repo rate by 25 bps. • FY26 real GDP growth is estimated at 6.7%. • CPI inflation in FY25-26 seen at 4.8%, with Q4 at 4.4%. • Early corporate results suggest a mild recovery in the manufacturing sector, while urban consumption remains subdued with mixed signals in the data. • Current account deficit expected to be within manageable level. Forex reserves at $630bn+ enough to cover imports for more than 10 months. • RBI forex policy has remained consistent, in favour of orderly and stable market operation, does not target any exchange rate. • The CAD for this year is expected to remain well within the sustainable level. • Surge in digital frauds is a matter of concern. • Bank liquidity buffers are sufficient. • RBI to require international credit card payments to have second factor authentication. This would mean global merchants will need to tie up with local payment cos to collect payments from India. • RBI to introduce 'bank.in' exclusive domain name starting April. • Two-factor authentication to be extended to international online payments • 'fin.in' domain to be introduced for broader financial system entities • Urge bank, NBFCs to improve cyber threat mitigating steps • To form working group to review mkt trading, settlement times BANK • Working group on mkt timings to submit report by Apr 30. • Next MPC meeting scheduled for April 7-9; minutes of the February MPC meeting to be released on February 21.