Industry Sees RBI Rate Pause As Strategic Breather, Not End Of Easing Cycle

RBI holds repo rate at 5.5%. Industry leaders see it as a pause, not a pivot, with real estate and home loan growth expected to stay strong.

Several voices in the market see the unchanged repo rate as a tactical pause and not the end of the easing cycle.

Source : ABPLIVE AI

The Reserve Bank of India’s decision to hold the repo rate steady at 5.5% in its latest monetary policy review has drawn cautious optimism from industry leaders, who see the pause not as a full stop but as a strategic breather amid global uncertainty.

With inflation under control and borrowing costs already down by 100 basis points since February, the central bank has chosen to wait and watch. The move, according to sector watchers, offers breathing space to assess the impact of previous cuts while keeping the door open for more easing if conditions allow.

Real Estate: Momentum Intact, Festive Tailwinds Ahead

Developers, in particular, appear unshaken by the RBI’s decision to hold rates. Pradeep Aggarwal, Founder and Chairman of Signature Global (India) Ltd., said the unchanged stance will help sustain consumer confidence and preserve the affordability created by earlier cuts.

“The steady interest rates, combined with strong demand for quality housing, will keep the sector’s growth trajectory intact,” Aggarwal said. He expects developers to maintain their focus on new launches, which in turn will support GDP growth, job creation, and urban infrastructure expansion.

Ashok Kapur, Chairman of Krishna Group and Krisumi Corporation, echoed this sentiment, noting that while a further cut would have helped, current rates remain accommodative. “With the festive season around the corner, stable rates and positive sentiment should ensure a strong performance in the mid and premium housing segments,” he said.

Home Loans: Refinancing Surge, Rate Transmission In Focus

From a borrower’s standpoint, home loan rates have already slipped below 8% for top-tier customers, especially for balance transfers and refinancing. Adhil Shetty, CEO of BankBazaar.com, believes this trend will continue as banks pass on the full benefit of the RBI’s earlier rate cuts.

“There’s still room for borrowers with older loans to switch to repo-linked products and reduce long-term costs,” Shetty said. He also flagged a likely softening in deposit rates in the coming quarters, urging savers—especially senior citizens—to lock in fixed deposits while rates still hover above 7.25%.

Raoul Kapoor, Co-CEO of Andromeda Sales and Distribution, agreed that while the decision was expected, the real impact of the earlier 100 bps cut is still unfolding. “Retail credit, especially in home and personal loans, is likely to pick up steam in the festive months. We don’t believe the RBI is done cutting just yet,” he said.

Forward Outlook: Caution Today, Cuts Tomorrow?

Several voices in the market see this as a tactical pause, not the end of the easing cycle. Sushil Bedarwal, CMD of Bedarwal Group, noted that India’s growth remains resilient and expects the central bank to return to rate cuts, possibly shaving another 25–50 bps before year-end, if macroeconomic indicators remain favourable.

“The market is still absorbing the impact of the last three cuts. A pause now gives room for their effects to play out more visibly in credit offtake and consumption,” he said.

The RBI’s decision to hold the line on rates may not be the adrenaline shot some were hoping for, but the underlying message is clear: stay the course, let earlier measures settle, and keep options open. For now, that’s enough to keep business sentiment afloat and expectations of further easing alive.