India, June 6 -- The Reserve Bank of India (RBI) cut its key repo rate by a larger-than-expected 50 basis points to 5.50%, RBI governor Sanjay Malhotra announced on Friday after the Monetary Policy Committee (MPC) meeting.

This was a third consecutive reduction, as muted inflation provided space for policymakers to focus on supporting economic growth.

It has now cut rates by 100 basis points in 2025, starting with a quarter-point reduction in February, its first cut since May 2020. It made a similar-sized cut in April.

Inflation has softened significantly, Sanjay Malhotra said, adding that there is comfort on inflation aligning with the central bank's target of 4%. Core inflation is also expected to remain benign.

India is already gro...