The Reserve Bank of India has reduced the policy repo rate by 25 basis points to 5.25 per cent, aiming to further support economic growth, which touched a six-quarter high of 8.2 per cent in Q2 of the current financial year, despite concerns over the rupee’s depreciation.

The rate cut is likely to bring down borrowing costs across sectors, including home, auto and commercial loans.

While announcing the fifth bi-monthly monetary policy of the fiscal, RBI Governor Sanjay Malhotra stated that the Monetary Policy Committee (MPC) unanimously voted to reduce the short-term lending rate to 5.25 per cent, maintaining a neutral policy stance.