Growth worries and declining inflation enable the RBI to lower rates and display MPC minutes.

According to February policy minutes, the Reserve Bank of India's (RBI) monetary policy committee (MPC) members stated that the central bank had the right to lower interest rates because of worries about the country's economic expansion and slowing inflation trajectory. Since the December 2024 policy, there has been a change in the domestic growth inflation balance; growth results were poorer even while inflation showed consecutive softening. The outlook for domestic GDP and inflation is clouded by increased uncertainty arising from global financial markets and trade policies, according to RBI deputy governor M Rajeshwar Rao. Furthermore, RBI governor Sanjay Malhotra stated that he believes a lower policy rate is more suitable at this time because of the macroeconomic forecast, which predicts that inflation would be in line with the objective, and since monetary policy is forward-looking. While the rates for the Standing Deposit Facility, Marginal Standing Facility, and bank rates stayed at 6.5 percent, the central bank reduced the repo rate by 25 basis points (bps) to 6.25 percent in its February monetary policy. Between May 2022 and February 2023, the RBI raised the repo rate by 250 basis points. In order to control inflation and bring it down to the medium-term aim of 4 percent, the repo rate has remained stable at 6.5 percent since April 2023. In its February policy meeting, the RBI's Monetary Policy Committee acknowledged that concerns over slower domestic growth and a declining inflation trajectory—compounded by uncertainties in global financial markets and trade policies—warranted a rate cut; despite maintaining key rates like the Standing Deposit Facility and Marginal Standing Facility at 6.5%, the central bank reduced the repo rate by 25 basis points to 6.25% as RBI Governor Sanjay Malhotra and Deputy Governor M Rajeshwar Rao highlighted that this move, following a series of hikes that raised the repo rate by 250 basis points between May 2022 and February 2023, was necessary to align the macroeconomic forecast with the medium-term inflation target of 4% while addressing the evolving domestic growth-inflation balance.