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RBI Monetary Policy: The Monetary Policy Committee of the Reserve Bank of India (RBI) has started from Monday. RBI Governor and MPC Chairman Shaktikanta Das will announce the outcome of the three-day debate on Wednesday (October 9). Economic experts believe that the RBI will not follow the US Federal Reserve, which recently cut interest rates by half a percentage point. Kaushik Das, chief economist for India and South Asia at Deutsche Bank, said, “We think the RBI will not change the policy repo rate (currently 6.50 percent) in the next October monetary policy meeting. However, home and car loan borrowers need not be disappointed by the lack of cuts this time. Home loan interest will be reduced to .40% in the near future.
Home and car loan EMI will reduce from December
Economic experts say that this time there is little hope of RBI cutting interest rates. But during the festive season, banks will come up with many attractive schemes to increase their market share. In this, home loans will be given at affordable interest rates to customers with good credit scores. At the same time, if interest rate is not cut this time, then repo rate cut is certain in the next quarter. Due to this, we can expect a reduction in home loan interest rates from banks by 25-40 basis points in the last quarter of this financial year. This means that from December you can get the gift of a cheap home loan.
Inflation and global tensions raise concerns
Retail inflation in India is a matter of concern and the Middle East crisis is likely to worsen, which has weighed on crude oil and commodity prices. Earlier this month, the government reconstituted the Monetary Policy Committee (MPC) – the rate-setting committee of the Reserve Bank of India (RBI). The first meeting of the reconstituted committee comprising three newly appointed external members began on Monday. The Reserve Bank of India has kept the repo rate unchanged at 6.5 percent from February 2023. Experts believe that there is scope for some relaxation in this in December itself. The government has tasked the central bank to ensure that Consumer Price Index (CPI) based retail inflation remains at four per cent (plus or minus two per cent).