New Delhi : Home, auto and corporate loans may get cheaper as the new RBI Governor Urjit Patel-led panel today marked its debut policy review with a surprise 0.25 per cent rate cut — lowering borrowing cost to a 6-year low, which the industry lauded as a pre-Diwali gift. In independent India’s first collective interest rate setting decision, the 6-member Monetary Policy Committee, which has three members nominated by the government and the rest from the Reserve Bank, lowered repo rate to 6.25 per cent from 6.50 per cent.
Tuesday’s cut came amidst a big clamour for easing rates, especially after the departure of former Governor Raghuram Rajan, who was often accused by some sections of stifling growth by keeping rates too high.
