MPC external member Ram Singh signaled that a repo rate hike is not on the cards for now, tying the decision to whether inflation triggers second-round effects. He expects the West Asia conflict to ease, which could moderate price pressures, while saying forex reserves remain adequate and open market operations will support liquidity. Growth, he adds, stays resilient despite supply risks.
RBI has reduced the repo rate by 25 basis points, offering fresh relief to home loan borrowers by potentially lowering floating-rate interest rates. On a 20-year loan, EMIs are expected to fall notably, though the extent depends on how lenders recalibrate pricing. Further cuts hinge on inflation staying subdued and growth risks, with timing unclear.
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The RBI kept the repo rate unchanged at 5.5% on October 1, 2025 for the second straight meeting, after cuts earlier this year. With inflation slightly higher and small savings rates steady, banks may struggle to push floating home loan rates down further. Loans linked to EBLR may still reset faster, but the overall window for immediate relief looks narrower.
The RBI kept the repo rate unchanged at 5.25%, citing persistent West Asia tensions. While its GDP and inflation forecasts stay within targets, the central bank warned that potential supply chain disruptions could still pressure inflation and weigh on growth. Despite geopolitical uncertainty, markets responded positively to the policy decision, reflecting confidence in the current stance.
The RBI has cut the repo rate by 25 basis points for the first time in nearly five years, reshaping expectations for fixed deposit returns. Despite the move, inflation concerns, slower GDP, and a weaker rupee limit room to celebrate. Any next reductions—potentially 50 to 75 bps—may hinge on inflation staying in check and global monetary conditions improving.
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