New Delhi

The Monetary Policy Committee (MPC), led by RBI governor Shaktikanta Das, maintained the benchmark repo rate at 6.5 per cent as anticipated.

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This was the first RBI MPC meeting of the new fiscal year, and experts and economists predicted that the RBI would maintain the current repo rate, given the uncertainty surrounding the global economy and the fact that the US Federal Reserve has not yet begun its cycle of rate cuts.

Commenting on the news, Adhil Shetty, CEO of Bankbazaar.com said, “The central bank's strategy reflects careful consideration of robust economic indicators, amidst factors such as monsoon performance, US federal decisions, and overall economic growth, ensuring continued high growth prospects for the country.”

He also noted that, as inflation starts to decline and food prices stay within predicted bounds, rates are now anticipated to possibly change by the end of the year. The Reserve Bank of India's cautious approach suggests that it has carefully considered the effects of past rate changes and economic data before considering any adjustments.

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According to Shetty, “This decision also has implications for banks and financial institutions, particularly concerning lending rates like home loan interest rates, which are linked to the RBI’s repo rate.”

Homebuyers can be assured about consistent loan interest rates if there is a stable repo rate, which is beneficial for both new and current loans with floating rates, according to Shetty.

“Stable interest rates not only enhance affordability for potential homebuyers but also foster consumer confidence, thereby sustaining demand in the real estate market,” he added.

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Shetty mentioned that fixed deposit (FD) interest rates are likely to remain stable when influenced by factors like the RBI’s policies, such as the repo rate, being unchanged.

He added that this stability benefits FD investors, particularly those looking for predictable income streams, like retirees and conservative investors who prioritise capital preservation and regular earnings.