India, Dec. 5 -- In a move poised to stimulate growth in the Indian economy, the Reserve Bank of India's Monetary Policy Committe has reduced the benchmark repo rate by 25 basis points to 5.25%. While a shot in the arm for borrowers, the RBI repo rate cut presents a mixed bag for the common man, offering immediate relief on home loan EMIs but dimming the prospects of high returns on traditional savings instruments such as fixed deposits.

The repo rate-the rate at which the RBI lends money to commercial banks-acts as a crucial lever in the Indian economy. A cut in this rate makes borrowing cheaper for banks, and the central bank's intention is for this reduced cost to be passed on to the end consumer in the form of lower lending rates.

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