The three-day Monetary Policy Committee (MPC) meeting of the Reserve Bank of India (RBI) began on September 29.
On the final day, RBI Governor Shaktikanta Das announced that the repo rate will remain unchanged at 5.50%.
This is the second consecutive meeting with no change, following a 100 basis point reduction earlier this year.
All six MPC members voted unanimously for this decision.
Impact on Loan EMIs
Since the repo rate remains at 5.50%, loan interest rates will not change.
This means:
Home loans, auto loans, and personal loans EMIs will remain the same.
There is no relief in monthly payments, but also no extra burden.
Example:
Home loan: ₹60 lakh for 20 years at 8.5% interest → EMI ≈ ₹52,026
If the repo rate remains unchanged, EMI will stay the same.
According to Jitesh Gupta, Founder and Director of Adore Group, this decision shows a neutral and stable monetary policy, providing clarity and stability to home loan borrowers.
While it won’t immediately reduce EMIs, it prevents sudden increases in interest rates that could disrupt family budgets.
Housing Market Benefits
In addition to repo rate stability, the reduction in GST rates on housing-related items will make homes more affordable.
Benefits include:
Lower GST on construction and services → reduced costs for developers and buyers
Easier launch of new projects
Increased attractiveness of home buying
Likely boost in consumer confidence in the real estate market
Effect of Repo Rate Cut on EMIs
If the RBI reduces the repo rate by 25 basis points, EMIs on loans could decrease by 0.2–0.3%:
Examples:
₹50 lakh home loan (20 years, 8.5%) → save ₹500–700/month
₹60 lakh home loan (20 years, 8.5%) → EMI drops from ₹52,026 to ≈ ₹51,300 → save ~₹726/month
₹10 lakh auto loan (7 years, 9%) → EMI drops from ₹18,900 to ₹18,700 → save ~₹200/month
₹5 lakh personal loan (5 years, 11%) → EMI drops from ₹13,200 to ₹13,050
After the previous rate cut in June 2025, home loan demand in Tier-1 cities increased by 10–12%, showing that even small reductions can encourage borrowing.
