RBI Monetary Policy Review: Market expects 25 bps Repo Rate Cut from Shaktikanta Das
Capital heavy industries are very responsive to interest rates as it affects borrowing rates, both for developers and for buyers. Any rate cut is welcome for it.
RBI MPC: The Reserve Bank of India's three-day Monetary Policy Committee (MPC) review meeting began on June 3 and the market is full of speculation and demand from the governor Shaktikanta Das about the Repo Rate cut. While some expect that the RBI won't cut its key rate until the full union budget is presented on July 5, other experts are of the opinion that the RBI may cut the Repo Rate by additional 25 bps to enhance liquidity in the market and put breaks on the borrowing rates. But, the majority is in favour of bringing Repo Rate down by 25 bps.
Speaking on the RBI MPC review meet and his expectation from Shaktikanta Das, Vikram Chari, CEO of Smartowner Services India said, "Capital heavy industries are very responsive to interest rates as they affect borrowing rates, both for developers and for buyers. Any rate cut is beneficial to the sector."
Rakesh Yadav, CMD, Antriksh Group said, "An additional 25 bps rate cut would enable the borrowing to come down and make it more convenient for the home buyers to go for their dream home. In fact, the real estate sector has been facing a sluggish sale for the last few years and any help from the bank in terms of a rate cut and more liquidity would be a welcome step from the RBI Governor Shaktikanta Das." However, he said that RBI cutting rates won't work until the operating retail banks pass on the benefit to its customers.
Expecting status quo in the RBI key rates until the Union Budget is presented Anuj Gupta, Deputy Vice President, Angel Broking said, "I don't think the RBI would take any such decision that would affect the liquidity in the market. In fact, it would wait for the full union budget and then only, it would decide whether it requires its intervention in regard to the key rates."