RBI Cuts Repo Rate to 5.25% — Dec 5, 2025 Monetary Policy Update

Policy Decision: The RBI’s Monetary Policy Committee on 5 December 2025 cut the repo rate by 25 basis points to 5.25%, citing disinflationary momentum and room to support growth. :contentReference[oaicite:0]{index=0}

Liquidity & Market Support: Alongside the rate cut, the RBI announced liquidity-enhancing measures including a ₹1 trillion government bond purchase program and $5 billion forex swaps to smooth external financing. :contentReference[oaicite:1]{index=1}

Macroeconomic Outlook: The central bank revised its FY26 GDP forecast higher and trimmed inflation projections — signalling confidence that growth can be supported without stoking inflation. Governor Sanjay Malhotra highlighted the disinflationary trend and the committee’s unanimous decision. :contentReference[oaicite:2]{index=2}

Impact: The cut is expected to ease lending costs (home and auto EMIs likely to fall) and provide breathing room for borrowers; markets will watch transmission, the rupee reaction and forthcoming post-cut guidance closely. :contentReference[oaicite:3]{index=3}

What’s Next: The RBI said it will remain ready to ensure orderly market functioning and monitor inflation and external sector developments before deciding further policy moves. :contentReference[oaicite:4]{index=4}