All six members voted unanimously for the rate cut while maintaining a neutral stance. The rate cut comes even as the past four headline inflation prints were above 5 per cent. RBI Governor Sanjay Malhotra noted that inflation is expected to decline.

The RBI rate cut will help improve loan affordability and boost housing demand. Lower interest rates will benefit existing and new home loan borrowers.

The Reserve Bank of India (RBI) reduced its key repo rate on Friday for the first time since May 2020, aiming to provide stimulus to the sluggish economy, which is projected to grow at its slowest pace in four years during the current fiscal year.