Realty industry welcomes RBI’s decision of reducing the repo rates by 25 bps

By Accommodation Times News Services


Reserve Bank of India (RBI) issued its first quarter monetary policy for the financial year 2016-17, with a positive start for current year, RBI Governor Raghuram Rajan announced the policy with a rate cut of 25 basis points from 6.75 per cent to 6.5 per cent.

On the basis of an assessment of the current and evolving macroeconomic situation, the bank decided to reduce the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points and reduce the minimum daily maintenance of the cash reserve ratio (CRR) from 95 per cent of the requirement to 90 per cent with effect from the fortnight beginning April 16, 2016.

Though bank has kept the CRR unchanged at 4.0 per cent of net demand and time liabilities.

The move will be positive for the real estate industry and home buyers, as home loans will get cheaper with banks passing the benefits to the home buyers. Recently, country’s largest bank State Bank of India, reduced its lending rates by 10 bps, under the Marginal Cost of Funds based lending Rate (MCLR) regime. The move will may bring further reduction in rates.

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