Mumbai, Dec. 22 -- The Reserve Bank of India (RBI) may reduce the repo rate by 25 basis points (bps) in its February monetary policy meeting, taking the benchmark rate down to 5 per cent, according to a report by Union Bank of India.

The report highlighted that there is scope for a final 25 bps rate cut either in February or April 2026, given the central bank's dovish policy guidance.

It noted that the RBI has made multiple references to benign inflation conditions and subdued underlying price pressures.

The report added that if the impact of around 50 bps inflation from gold is adjusted, inflation pressures appear even more moderate.

"We see scope for final 25bps rate cut in Feb or April 2026. Given the dovish policy guidance, we can...