RBI Cuts Repo Rate by 25 bps to 5.25% (Dec 5, 2025)

December 06, 2025
Current Context: On 5 December 2025, the Reserve Bank of India (RBI) reduced the repo rate by 25 basis points.

RBI Cuts Repo Rate by 25 bps to 5.25% (Dec 5, 2025)
  • The new repo rate now stands at 5.25%, down from 5.50%.
  • This decision was taken in response to easing inflationary pressures.
  • The cut makes borrowing cheaper for banks, encouraging lending and investment.
  • It is expected to boost credit flow, consumption, and overall economic growth.
  • The move reflects RBI’s accommodative monetary stance balancing growth with price stability.
  • At 5.25%, the repo rate is among the lowest levels in recent years, signaling confidence in India’s economy.

Question:

Q1. On 5 December 2025, the RBI reduced the repo rate to:
a) 5.50%
b) 5.35%
c) 5.25%
d) 5.00%

Answer: c) The content states that after a 25 basis points cut, the new repo rate stands at 5.25%.

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