Repo Rate: Impact of RBI’s repo rate cut: What will be the impact on the stock market, EMI and FD?

News India Live, Digital Desk: reserve Bank of India The Monetary Policy Committee of the Committee generously scissor, cut the repo rate by 50 basis points, decreasing from 6% to 5.5%. If seen from the beginning of February, this decline ranged from 6.5% to 5.5% – a decline of 100 basis points in four months. But the biggest question is, what can be the effect on your pocket?

Equity markets reacted as expected. When the Sensex was at 81,407 am at 10:15 am, the Sensex 30 gained a gain of around 750 points and at 11:15 am when it reached 82,155 points. Decreased capital costs may definitely increase consumption and increase margins for corporates in general. But what can it mean at the retail level?

When the RBI cut the repo rates by 50 basis points in the repo rates between February and April, all the banks of the country responded by reducing the loan rates on all types of retail loans such as personal loans, home loans and vehicle loans. Against that background, what can be meant to cut a night of 50 basis digits. Although this will certainly reduce all debt rates, its biggest impact can be on home loans, vehicle loans and personal loans.

For example, a home loan is one of the most important loans as they can promote the sales of residential units, which in turn can lift the fate of many areas such as cement, steel, electricals, paints, home deccur items, furniture etc. Home loan rates of major PSU banks in India are between 7.8% and 8%. Canara Bank rate is 7.8%, Bank of Maharashtra, Central Bank, Union Bank (all 7.85%), Indian Bank, Indian Overseas Bank (both 7.9%), State Bank of India, PNB, Bank of Baroda (all 8%). All these can collapse in a few days and move towards a mark of 7.6-7.5%.

FD rates fall

Interest rate cuts are good news for consumers, but this cannot give deposits as positive indications. All banks have already cut their deposit rates after a cut of 50 basis points by April – especially in fixed deposit rates for all periods. Now with heavy cuts, banks are going to drasticly cut the existing FD rates.

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