Wed Oct 09 06:01:09 UTC 2024: ## RBI Keeps Repo Rate Steady for 10th Consecutive Time, Signals Potential Shift in Stance

**Mumbai, India** – The Reserve Bank of India (RBI) has maintained the policy repo rate at 6.50% for the tenth consecutive time, reflecting a focus on managing inflation despite global economic trends. However, the MPC meeting on October 9 signaled a shift in stance from “withdrawal of accommodation” to “neutral,” suggesting a potential path toward future rate cuts.

The decision, while welcomed by the real estate sector for its stabilizing effect on home loan rates, comes at a time when inflation remains a concern, although it is projected to cool in the coming months.

“We were more hopeful of a rate cut this time around, after moves by the U.S. Federal Reserve and other central banks,” said Ashwin Chadha, CEO, India Sotheby’s International Realty. “But the RBI’s decision to hold the repo rate steady shows that India is laser-focused on its own economic landscape.”

The MPC is targeting a 4% inflation rate and expects a “durable alignment” of inflation with this target. This, coupled with the change to a “neutral” stance, has fueled speculation about a potential rate cut in the December 2024 meeting.

“While RBI has kept the benchmark lending rates unchanged at 6.5%, a change in stance from “withdrawal of accommodation” to “neutral” indicates its clear direction for a possible reduction in interest rates in the foreseeable future,” explained Vimal Nadar, Head of Research, Colliers India.

Anuj Puri, Chairman of ANAROCK Group, highlighted the positive impact on the housing market during the festive season. “With the unchanged home loan rates, we are expecting faster sales momentum in Q4 2024 when compared to the preceding quarter,” he said.

The RBI also announced an increase in UPI 123 Pay transaction limits to ₹10,000, and outlined plans to address potential stress in unsecured loan segments like microfinance and credit card outstandings. The focus remains on ensuring financial stability and sustainable growth, with continued attention on cybersecurity and responsible lending practices within the banking and NBFC sectors.

The MPC meeting concluded with a message of cautious optimism. “We must keep the horse in tight leash so that we do not lose control going forward,” stated RBI Governor Shaktikanta Das. “We need to closely monitor the evolving conditions for further confirmation of the disinflationary impulses.”

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