New Delhi, Feb. 6 -- The Reserve Bank of India (RBI) is expected to reduce the repo rate by 25 basis points (bps) in its upcoming monetary policy announcement on February 7, according to a report by Bank of Baroda.

The report suggested that inflation, which remains the primary focus of monetary policy, is showing signs of moderation, allowing the RBI to consider a rate cut.

It said, "balancing and counterbalancing all macro and geopolitical factors, we believe there remains space for 25bps rate cut by RBI in the upcoming policy."

The report highlighted that inflationary pressures have eased, mainly due to a decline in the prices of essential vegetables such as tomatoes, onions, and potatoes. The improved supply of these items has contr...