Today’s repo rate cut will further help banks to lower home loan interest rates, which may get several more fence-sitters onto the market.
Tag: RBI Monetary Policy
Anuj Puri, Chairman – ANAROCK Property Consultants
The Reserve Bank of India’s stance of keeping the repo rate unchanged at 6% is exactly along the lines of our expectations.
Considering that the inflation has inched up (Dec-17 CPI at 5.21%, up from 3.58% in Oct-17 and well above the target of 4%), crude oil prices are rising in the international market and the Government plans to increase the crop support price, maintaining the lending rates unchanged is justified.
We believe that the interest rates will soon start inching upwards, which is already being factored into the rising bond yields for the past few months.
The real estate sector can and should look at the long-term economic prospects and implications on which the monetary policy decisions are based, as these will dictate the growth trajectory for the sector.
Anuj Puri, Chairman – Anarock Property Consultants
The repo rate has been reduced by 25 bps to 6.0 per cent, reflecting the slightly accommodative stance that the Monetary Policy Committee has taken as it agreed that headline inflation has come down significantly.
While many inflation upside risks have not manifested themselves as yet, the MPC feels that inflation may trend upwards going forward based on farm loan waivers, states passing on increased salaries / allowances and expected pressures on food inflation. The RBI remains more committed to keeping inflationary pressures under check.