RBI's 2025 Policy: From Cautious Easing to Aggressive Growth Support

• The RBI's monetary policy in 2025 shifted from guarded easing to confident growth support, driven by sharp disinflation and strategic rate cuts.
• The year began with a 25 bps rate cut in February under Governor Sanjay Malhotra, maintaining a neutral stance due to global uncertainties.
• By April, inflation was below target, leading the MPC to change its stance to accommodative and signal a clear bias towards easing.
• June saw a significant 50 bps rate cut, bringing cumulative easing to 100 bps (6.50% to 5.50%) in four months, surprising markets.
• Despite frontloading easing, the RBI returned to a neutral stance in June, acknowledging limited space for further rate cuts, focusing on transmission and data.