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Personal Finance News

How has the repo rate changed in the last 1 year?

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By Sangeeta Ojha

2 min read | Updated on April 07, 2026, 12:13 IST

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SUMMARY

The Reserve Bank's rate-setting panel on Monday started its three-day brainstorming session on the first bi-monthly monetary policy of the fiscal year amid expectations of a status quo on the benchmark lending rate in view of the ongoing West Asia crisis.

repo rate changes in last one year

How the RBI’s repo rate has changed over the last year, its impact on borrowers, investors. | Image: Shutterstock.

The Reserve Bank of India (RBI) has gradually reduced the repo rate over the past year. The interest rate at which the central bank lends to commercial banks was reduced from 6.50% in February 2025 to 5.25% by December 2025, a cut of 125 basis points.

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The rate cuts were rolled out in phases. In February 2025, the RBI reduced the repo rate by 25 basis points, taking it to 6.25%. This was followed by another 25-basis-point reduction in April, bringing the rate down to 6.00%. The central bank took a more aggressive approach in June, slashing the rate by 50 basis points to 5.50%.

The repo rate then remained unchanged in the August and October monetary policy reviews, with the RBI maintaining a “neutral” stance.

In the final policy review of 2025, RBI Governor Sanjay Malhotra announced a further 25-basis-point cut, bringing the repo rate to 5.25%.

In its first monetary policy review of 2026, held in February, the central bank kept the rate unchanged at 5.25%, continuing with a neutral policy approach.

The Reserve Bank's rate-setting panel on Monday started its three-day brainstorming session on the first bi-monthly monetary policy of the fiscal year amid expectations of a status quo on the benchmark lending rate in view of the ongoing West Asia crisis.

The decision of the six-member Monetary Policy Committee (MPC), headed by Reserve Bank Governor Sanjay Malhotra, will be announced on Wednesday.

How repo rate changes affect you

For borrowers, the RBI’s rate cuts in 2025 mean loans are now cheaper. Whether it’s a home loan, auto loan or personal loan, EMIs could be smaller. The benefit depends on how fast your bank adjusts its interest rates to match the RBI’s changes.
For investors and savers, the flip side is that returns on fixed deposits and other bank deposits may fall. As banks lower deposit rates to align with the repo rate.
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About The Author

sangeeta-ojha.webp
Sangeeta Ojha is a business and finance journalist with experience across leading media platforms like Mint and India Today. She has built a reputation for covering a wide range of personal finance topics, including income tax, mutual funds, insurance, savings and investing.

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