Informist New Delhi

Worries about India's growth outlook amid heightened global uncertainty, and increasing comfort with inflation dominated the Reserve Bank of India's Monetary Policy Committee's Apr. 7-9 policy meeting where it cut the repo rate by 25 basis points to 6.00%, minutes from the meeting released on Wednesday showed. Members said that growth requires more support at the current juncture and the projected inflation trajectory opens space for policy easing.

"...considerable progress achieved on the disinflation front has offered latitude to monetary policy to be growth supportive," RBI Executive Director Rajiv Ranjan said in his statement in the minutes. "On balance, while growth is still reasonable, it is lower than our aspirations and needs policy impetus amidst a challenging global environment," Ranjan said. 

April was the second consecutive meeting when the MPC lowered interest rates by 25 bps as growth remained far from robust while inflation is seen staying closer to the RBI's medium-term target of 4%. The MPC also unanimously adopted the accommodative stance from neutral, indicating that going forward the rate-setting panel will only either keep interest rates on hold or lower them.  

RBI Governor Sanjay Malhotra said that growth is still moderate and "monetary policy needs to nurture domestic demand impulses to further increase the growth momentum." Saugata Bhattacharya, external member of the MPC, said that forecasted moderate inflation path opens up more space for "good news" policy easing. "Moreover, the present resilience of economic activity does not as yet necessitate additional "bad news" actions associated with prospects of a significant growth slowdown," Bhattacharya said in his statement.  The RBI at the April MPC meeting lowered its growth and inflation forecasts for 2025-26 (Apr-Mar) by 20 bps each to 6.5% and 4.0%, respectively.