RBI Cuts Repo Rate by 25 Basis Points

The RBI's Monetary Policy Committee has implemented a 25 basis point rate cut, aligning with market expectations. This marks the first consecutive rate cut since the committee's inception in 2016. The decision is influenced by a neutral policy stance, a GDP forecast of 7.2% for fiscal 2020, and inflation consistently below the RBI's 4% target. Economic indicators show a slowdown, prompting the RBI to support growth through lending. Future rate cuts depend on factors like monsoons, global growth, and oil prices, with upcoming elections also playing a crucial role.

What external factors could influence future interest rate cuts by the RBI?

Why is the upcoming election season considered important for policymaking?