'Abhi mazaa ayega na bhidu': RBI cuts repo rate after 5 years to 6.25% & the internet can't keep calm, here's why
After nearly five years, the RBI has finally cut interest rates, bringing much-needed relief to borrowers. The internet is flooded with memes as people celebrate cheaper loans, making it easier to buy homes, cars, and fund businesses.
After almost five years, the RBI has finally done it¡ªa 25 basis point rate cut, bringing the key interest rate down to 6.25%. The last time this happened was way back in May 2020. And now? The internet is flooded with hilarious memes because cheaper loans are finally here, and people have been waiting longer than a customer at an understaffed bank counter!
RBI cuts repo rate by 25 BPS at 6.25% #rbipolicy
¡ª Sanket (@BTechComedian) February 7, 2025
Floating Home Loan borrowers : pic.twitter.com/A2hWFtYEih
#rbipolicy
¡ª Sanjana Mohan (@SanjanaMohan10) February 7, 2025
RBI cuts #RepoRate to 6.25 Basis point.
Le #HomeLoan seeker be like:-#RBIMonetaryPolicy #PranaliRathod #ExitPolls #StocksToWatch #arrestwarrant #DelhiAssemblyElection2025 #Zomato#ExitPolls pic.twitter.com/IUS9VpCJh2
after RBI Repo Rate cut by 25 bps to 6.25% ?
¡ª Daphi (@Dafi_syiemz) February 7, 2025
Meanwhile Indian, and Bank Sector be like ??#RateCut #RepoRate #NagaChaitanya #Zomato #DelhiAssemblyElection2025 #ExitPolls #GIFTNIFTY #intraday pic.twitter.com/ehAyRn7bdN
What is repo rate and what does a reduction in it mean?
The repo rate (repurchase agreement rate) is the interest rate at which a nation's central bank provides short-term loans to commercial banks. In India, this role is handled by the Reserve Bank of India (RBI).
When the repo rate is lowered, borrowing money becomes cheaper for banks. As a result, they often reduce interest rates on loans for individuals and businesses. This makes borrowing more affordable, boosting spending and investment, which can help drive economic growth.
Why has RBI reduced the repo rate?
After the Union Budget 2025-26 introduced historic tax relief to spur middle-class spending, the RBI's Monetary Policy Committee (MPC) unanimously decided to cut the policy rate by 25 basis points.
The move aligns with the Finance Ministy's push for coordinated fiscal and monetary policies to drive economic growth.
What are the tax relief measures introduced in the Union Budget 2025-26?
Key tax reforms in Budget 2025-26
One of the major highlights of the 2025-26 budget is tax relief for both salaried individuals and businesses. The government has introduced significant changes to ease the tax burden:
Higher Tax Exemption Limit ¨C Individuals earning up to ?12 lakh annually will now be exempt from income tax under the new regime.
Revised Tax Slabs ¨C Restructured brackets aim to benefit those earning between ?12 lakh and ?24 lakh per year.
Increased Standard Deduction ¨C Salaried employees and pensioners will gain from a higher standard deduction, providing additional relief.
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