New Delhi India central bank cuts interest rates as Trump tariffs kick in

INDIA'S central bank cut interest rates in the world's fifth-largest economy yesterday as US President Donald Trump's tariffs kicked in and policy makers warned of realing global economic conditions.

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The cut, the second this year, aims to boost a slowing economy grappling with the impact of Trump's sweeping tariffs.

The Reserve Bank of India (RBI) said the benchmark repo rate would be reduced by 25 basis points to 6 percent.

The central bank's monetary policy committee announced the same day Trump's tariff for the world's most populous nation came into effect.

Last month's inflation over the past few months have allowed the RBI to focus on spurring up the Indian economy, whose growth has slowed in the last few quarters.

Trump's protectionist trade policies will likely add to growth pressures and present a challenge for Indian policy makers.

While New Delhi is not in panic-fighting mode, experts believe that rising US tariffs will hurt billions of dollars of Indian exports across different sectors, including gems, jewellery and seafood.