India central bank cuts rate

Rajan at the Reserve Bank of India’s headquarters in Mumbai. The central bank lowered policy repo rate by 25 basis points to 7.5 yesterday. – Bloomberg

MUMBAI: India’s central bank lowered its policy repo rate by 25 basis points (bps) to 7.5% yesterday, its second inter-meeting cut this year on the back of easing inflation and what it said was the “weak state” of parts of the economy.

Although markets had broadly expected the Reserve Bank of India (RBI) to cut rates again after its surprise January easing, few had expected a move as early as this week, just days after the government presented its annual budget for the coming fiscal year.