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The Reserve Bank of India's (RBI) decision to reduce the repo rate by 25 basis points to 6.25 per cent has received widespread appreciation from industry experts and market stakeholders, who see it as a well-timed move to boost economic growth, ease borrowing costs, and stimulate the real estate sector.
Anshul Jain, Chief Executive, India, SEA & APAC Tenant Representation at Cushman & Wakefield, described the move as "well-timed and much-needed," particularly as CPI inflation eases and Q2-FY25 GDP growth slows. "RBI's decision to cut the repo rate by 25 basis points to 6.25 per cent is a well-timed and much-needed move. With CPI inflation easing and Q2-FY25 GDP growth slowing, this was an opportune moment for the RBI to initiate rate cuts," Jain said. He added, "This move is going to help revive growth in consumption, and it will also help reduce borrowing cost for the interest rate-sensitive housing sector, particularly in the affordable and mid-income category homes. The recent measures in the Union Budget along with the RBI policy decision has offered a much-needed stimulus for sustained growth in the residential market." Praveen Khandelwal, Delhi Chandni Chowk MP and Confederation of All India Traders (CAIT) Secretary General also welcomed the rate cut, calling it a "pro-growth" decision that will lower borrowing costs for businesses and consumers. He highlighted that with inflation projected at 4.8% for FY 2025 and 4.2% for FY 2026, the RBI's move strikes a balance between economic growth and price stability. "Lower EMIs on home and business loans will provide financial relief, boost disposable incomes, and enhance consumer spending. Increased liquidity in the market will encourage business investments and overall economic momentum," Khandelwal said. He added, "If the income tax exemption limit is increased to Rs12 lakh in the upcoming budget, it would significantly enhance household savings. The additional savings would drive higher consumer spending, increased demand, and greater market liquidity, ultimately fueling economic growth and a potential market boom." Ashwani Rana, Founder of Voice of Banking, echoed similar sentiments, stating that the RBI's decision provides another financial relief to the middle class following the Union Budget. He said, "The Marginal Standing Facility (MSF) rate has been lowered from 6.75% to 6.50%, making it easier for banks to borrow from the RBI when needed. Despite these measures, inflation remains within RBI's target range, and GDP growth is stable. The decision to cut interest rates is expected to strengthen the economy while providing significant relief to banks and their customers." (ANI)
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