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6mo ago

RBI Maintains Repo Rate at 6.5%, Signals Possible December Cut

The Reserve Bank of India shifts its monetary policy stance to 'neutral,' suggesting a potential rate cut as inflation is expected to ease.

Overview

  • The RBI's Monetary Policy Committee (MPC) unanimously decided to keep the repo rate unchanged at 6.5% for the tenth consecutive meeting.
  • A change in policy stance from 'withdrawal of accommodation' to 'neutral' indicates the possibility of a future rate cut.
  • India's real GDP growth for FY25 is projected at 7.2%, with inflation expected to align with the 4% target in the coming months.
  • The real estate sector welcomes the stable interest rates, anticipating a boost in home sales during the festive season.
  • The central bank remains cautious due to geopolitical tensions and potential risks in inflation dynamics, particularly from food prices.