After today’s rate cut, it remains to be seen how much impact with the recent rate cuts, it will have on the home loan and other borrowers.
Repo Rate in India: In a bid to encourage growth and tide over the disruptions caused by COVID-19, the Reserve Bank of India (RBI) today cut the repo rate by a massive 0.75 per cent, to 4.4 per cent from 5.15 per cent earlier. In February 2020 and before that in December 2019, the RBI had kept the policy repo rate unchanged. However, overall, in the year 2019, the RBI had moved swiftly and cut the repo rate by 135 basis points.
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It, however, remains to be seen how much impact with the latest rate cut will have on the home loan and other borrowers even while the term loans are expected to come down. The RBI’s latest move is expected to lower interest rates for individuals who are also looking for personal loans and consumer good loans. If banks are able to lower the rates for them, they will propel demand and keep the consumption cycle on.
Source: Financial Express
