On 9 October 2024, the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) opted to maintain the policy repo rate under the liquidity adjustment facility (LAF) at 6.50 percent. The standing deposit facility (SDF) rate remains at 6.25 percent, while the marginal standing facility (MSF) rate and the Bank Rate stay at 6.75 percent. The MPC has shifted its stance to ‘neutral,’ emphasizing the need to achieve a sustainable alignment of inflation with the target while supporting economic growth. This approach aligns with the medium-term goal of keeping consumer price index (CPI) inflation at 4 percent, with a range of +/- 2 percent.
The industry reaction to the RBI’s decision to maintian the policy repo rates are listed below
Amit Kumar Malhotra Head of Sales & Marketing of Ambience Group said, “The RBI’s decision to keep the key rates unchanged reflects a balanced approach to the current economic landscape. The move to stabilize the rates, particularly the reverse repo at 3.35% and the inflation projection at 4.5%, provides a favorable environment for the housing sector. The controlled inflation outlook, despite the potential upward risks from rising metal prices, will help maintain home loan affordability, which is crucial for both home buyers and developers. We remain optimistic that this consistency in monetary policy will support steady demand in the residential real estate market, further encouraging the overall growth of the sector.”
Ravindra Gandhi, Founder and Managing Director of Tirasya Estates said, “The RBI’s decision to keep the repo rate unchanged, shifting its stance to neutral, is an encouraging news for the real estate market, benefiting both buyers and developers. This announcement has come around at a time when the sector is experiencing renewed energy, expanding into new regions and enhancing its offerings. This signifies stability in India’s economy, especially amidst global challenges. This status quo could also pave the way for potential rate cuts in the future, fostering greater optimism. However, we remain concerned about the affordable housing sector and hope the RBI will address its challenges in the upcoming reviews.”
Harsh Gupta, CEO of Sundream Group, Says, the RBI has once again made a commendable move by keeping the repo rate unchanged. This decision will instill confidence among buyers, especially during the festive season when commercial real estate is witnessing good sales. A stable repo rate provides reliability and confidence to home buyers. This stability directly impacts the growth of the real estate sector, which in turn plays a crucial role in contributing to India’s GDP and future growth prospects.
Kushagr Ansal, Director of Ansal Housing, “RBI’s decision to keep the repo rate unchanged will have a positive effect on the housing market. Although housing costs are rising, stable home loan rates provide much-needed relief to potential buyers. This stability benefits both buyers and developers by boosting consumer confidence and encouraging investment in the sector. The RBI’s decision is also expected to drive the launch of new projects and promote expansion in emerging areas of interest.”
Manit Sethi, Director, Excentia Infra, The RBI’s decision to maintain the status quo on the repo rate for the tenth consecutive time is a welcome move. It aligns with the country’s growth prospects and rapid infrastructural development. This stability benefits all stakeholders in the real estate sector—home buyers, developers, and financial institutions alike and encourages real estate development in tier 2 cities.
Cover Photo: www.pexels.com
