RBI MPC Dec 2024: Panel Keeps Key Rates Unchanged, Borrowers To Benefit From Stability In Home Loans, EMIs
RBI MPC Dec 2024: Additionally, the RBI also maintained the Marginal Standing Facility (MSF) rate at 6.75 per cent and the Standard Deposit Facility (SDF) at 6.25 per cent
RBI MPC Dec 2024: The Reserve Bank of India (RBI)’s Monetary Policy Committee (MPC) met this week and decided to keep the key rates unchanged. Panel’s chair, Governor Shaktikanta Das, on Friday revealed the final decisions regarding the country’s fiscal policy ahead.
The governor said that the status quo was maintained on interest rates and repo rate stood at 6.50 per cent. This marked the eleventh consecutive time the MPC opted to keep the key rates unchanged.
This decision will also keep home loan interest rates and equated monthly installments (EMIs) consistent for the borrowers. Additionally, the RBI also maintained the Marginal Standing Facility (MSF) rate at 6.75 per cent and the Standard Deposit Facility (SDF) at 6.25 per cent.
Impact On Home Loans, EMIs, And Real Estate
This stability in the key rates would also translate into relief and steadiness for the homeowners. The status quo in rates will help both real estate and lending institutions and raise sentiment in the market. This would also help allow lenders to enhance the supply of credit to homebuyers.
Pradeep Aggarwal, Founder and Chairman, Signature Global (India) Ltd, noted, “The Apex Bank’s decision to maintain the repo rate at 6.5% reflects a balanced and prudent approach to sustaining economic stability while fostering growth. This continuity provides a stable environment for the real estate sector, enabling developers to plan with confidence and homebuyers to benefit from favourable borrowing costs.”
'Neutral' Policy Stance
Further, the central bank also said that it will continue to keep a ‘neutral’ stance on policy going ahead. Harsh Gupta, CEO, Sundream Group welcomed the decision of the MPC and said that this will help provide ‘much-needed stability to the real estate market’. The executive said that this consistency will ensure home loan interest rates remain manageable, in turn, facilitating maintaining demand in the residential market.
“The neutral policy stance signals confidence in the current economic trajectory, offering a boost to investor sentiment in commercial real estate. Developers can now focus on launching projects without the immediate concern of fluctuating borrowing costs, potentially accelerating project pipelines and enhancing market supply,” he added.
CRR
Further, the decision to slash the cash reserve ratio (CRR) of the banks by 50 basis points to 4 per cent will also help enhance the lending capacity of the banks. This will also increase the credit supply from lenders and help consumers get improved access to credit. The CRR represents the ratio of the overall deposits a bank needs to maintain in liquid cash with the RBI.
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