RBI Monetary Policy: Interest rates remain unchanged. What effect will this have on bank loan EMIs and returns on investments?

RBI Monetary Policy: Interest rates remain unchanged. What effect will this have on bank loan EMIs and returns on investments?

Monetary Policy of the RBI:

The repo rate, or policy rates, have not changed at all according to the Reserve Bank of India (RBI). The 6.50 percent policy interest rate will not change.

RBI Policy: The repo rate, or policy rates, have not been altered by the Reserve Bank of India (RBI). The policy rate was declared by RBI Governor Shaktikanta Das after the meeting of the Monetary Policy Committee. According to him, the policy interest rates would stay at 6.50 percent as the repo rate has not been lowered.

The Reserve Bank of India (RBI)-led Monetary Policy Committee (MPC) decided to maintain the repo at 6.5%. For the sixth time in a row, interest rates were not changed by the central bank. rbiaEvery two months, the EIA Monetary Policy Committee convenes. The RBI did neither raise or lower the repo rate even at its most recent meeting in December.

There has been less inflation.

The central bank and government's efforts, according to the RBI Governor, have resulted in a decrease in the rate of inflation. The retail inflation rate is predicted by the RBI to be 4.5 percent in 2024–25 and 5.4 percent in the current fiscal year. The projected real GDP growth rate for the 2024 fiscal year is 7%. Before, analysts predicted that since retail inflation is still toward the top end of the acceptable range, the central bank would rarely alter its monetary policy, including the policy rate. For over a year, the Reserve Bank has maintained the repo rate at 6.5 percent. In February 2023, it was raised from 6.25 percent to 6.5 percent for the final time.

What effect will it have on bank loans and FDs?

The interest rates on bank-issued loans and savings plans won't alter, with interest rates staying at 6.50 percent. Interest rates are changed by banks and NBFCs in accordance with the RBI benchmark rate.