Private sector lender HDFC Bank has reduced its benchmark lending rates following the Reserve Bank of India’s (RBI) unexpected decision on Friday to cut the repo rate by 50 basis points in a bid to revive the slowing economy.The bank revised its marginal cost of funds-based lending rates (MCLR) downward by 10 basis points across all loan tenures. According to its website, the new rates came into effect on 7 June. The overnight and one-month MCLR now stands at 8.90%, the three-month at 8.95%, and the six-month and one-year tenures are down to 9.05%. The two- and three-year rates have been trimmed from 9.20% to 9.10%.The changes follow the RBI’s latest policy review, in which the central bank not only delivered a sharper-than-expected 50 basis point repo rate cut to 5.5% but also surprised markets by reducing the cash reserve ratio (CRR) by 100 basis points to 3%. The CRR cut is expected to infuse an additional Rs 2.5 lakh crore into the banking system.The RBI’s monetary policy committee, led by Governor Sanjay Malhotra, voted 5-1 in favour of the rate cut, signalling a stronger push to support lending and spur economic activity. This latest move brings the total rate cuts for 2025 to 100 basis points, following earlier reductions in February and April.
