RBI may cut policy rate by 25 bps in April: Ind-Ra

The Reserve Bank of India's Monetary Policy Committee (MPC) is expected to reduce the policy rate by 25 basis points during its meeting from April 7 to 9, according to India Ratings and Research (Ind-Ra).

In February, the MPC had cut the rate by 25 basis points to 6.25%, marking its first cut in five years. Ind-Ra anticipates up to three rate cuts in FY26, totalling 75 basis points. "The monetary policy actions in FY26 will be dependent on inflation movements, liquidity situation and trajectory of global commodity prices," said DK Pant, chief economist and head public finance at Ind-Ra.

According to Ind-Ra, this could result in a real repo rate of 1.5% in FY26. "However, if the impact of the reciprocal tariff turns out to be higher than the expectations, we may see higher easing by the RBI," it noted. The US has announced imposition of reciprocal tariffs, effective April 2, on countries, including India.


President Donald Trump announced 25% tariffs on import of cars and auto components to the US. -Our Bureau