By Admin 
GDP Growth Forecast: Reserve Bank of India (RBI) Governor Sanjay Malhotra has announced the reduction in repo rate on Friday, December 5. The Monetary Policy Committee (MPC) has decided to reduce the repo rate by 25 basis points to 5.25 percent. He also estimated that the GDP growth for the current financial year 2026 will be 7.3 percent. GDP growth has been increased from 6.8 percent to 7.3 percent. The inflation estimate for the third quarter of the financial year 2025-26 has been increased from 6.4 percent to 7 percent and for the fourth quarter from 6.2 percent to 6.5 percent.
RBI Governor gave information
RBI Governor informed that the domestic economic activities of the country are going on at a good pace. Demand in rural areas remains strong, while demand in cities is gradually improving. In the matter of repo rate, the Monetary Policy Committee has unanimously decided to cut interest rates. Under this, a reduction of 25 basis points has been made. Giving further information, Sanjay Malhotra said that before taking the decision of rate cut, MPC studied the changing macro economic situation and future possibilities in detail and on this basis all the members have taken the decision of rate cut.
Mentioned about GST reform and strong consumption
According to the RBI Governor, the country’s second quarter GDP growth accelerated due to strong consumption and reforms in GST. He said that retail inflation has come down to 0.25 percent in October 2025, which is the lowest level till date.
There was no change in the repo rate in the last monetary policy meeting on October 1. The committee had taken the decision to keep the repo rate stable at 5.5 percent.
How much did the repo rate decrease this year?
RBI had reduced the repo rate by a total of 100 basis points between February and June this year. That means interest rates were reduced from 6.5 percent to 5.5 percent. After this, no changes were made in the policy meetings of August and October and it was decided to keep the repo rate stable.
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