The Reserve Bank of India (RBI) reduced its key repo rate on Friday for the first time since May 2020, aiming to provide stimulus to the sluggish economy, which is projected to grow at its slowest pace in four years during the current fiscal year.

In addition to the repo rate cut, the Standing Deposit Facility (SDF) and Marginal Standing Facility (MSF) rates have also been reduced by 25 bps to 6% and 6.5%, respectively. The bank rate has also been adjusted to 6.5%.

Rate-sensitive sectors reacted mixed after RBI’s 25 basis points repo rate cut to 6.25%. The BSE Sensex fell 328 points, while Nifty Auto and Realty gained. Housing sector benefits from reduced rates,