India’s central bank, the Reserve Bank of India, decided to keep key policy rates unchanged for a 10th consecutive meeting.
The central bank’s monetary policy committee (MPC), which met on Wednesday, October 9, kept the repo – or short-term lending rate – unchanged at 6.5 per cent.
The decision is seen because of inflationary pressures, mainly on account of rising food and vegetable prices, besides rising tension in West Asia, which could impact commodity prices, including oil prices.
The MPC, however, announced a change in policy stance to ‘neutral’ from ‘accommodation’, thus opening the door for rate cuts.
Experts think some easing in interest rates could only be possible in December.
The government has tasked the central bank to ensure that Consumer Price Index (CPI) based retail inflation remains at 4 per cent with a margin of 2 per cent on either side.
Real estate industry experts said from the point of view of homebuyers, the status quo on lending rates would mean that the relatively affordable home loan interest rate regime will continue at a critical time for the Indian housing market – the festive season – amid rising housing prices and tapered sales.
The third quarter of 2024 saw average housing prices rise by a cumulative 23 per cent in the top 7 Indian cities.
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