The Reserve Bank of India (RBI) has decided to keep the repo rate stable in the Monetary Policy Committee (MPC) meeting on 6 August 2025. That is, there has been no cut in the interest rates of home loan yet. Nevertheless, experts say that there is scope for reduction in repo rate in the coming months. In the last few months, there was a lot of relief to those taking home loans. The RBI had cut the repo rate in the meetings of February, April and June by 1%, ie 1%. This led to a lot of savings in the EMI of a lot of home loan holders.
Will the home loan be cheaper?
People’s question is whether the interest rates of home loan can be reduced further. The answer depends on many things, especially retail inflation i.e. retail inflation. In June 2025, the inflation rate has come down to 2.1%, which is the lowest in the last one year. The decisions of RBI stand at this inflation. When inflation is low, the scope to reduce interest rates increases. But RBI will not go only on the present figures, he will also see what the attitude of inflation is further. VK Vijaykumar, the chief investment strategist of Geojit Investments, says, inflation can remain under control due to good monsoon and good condition of kharif crop. In such a situation, MPC can get another chance to cut the repo rate.
What are the indications from the market?
The 10 -year government bond yield was 6.843% in January, which declined to 6.16% by May. Right now it rests around 6.3%. That is, the market does not see the expectation of a big cut in interest rates in the near future. However, the impact of the cut of 100 basis points till June has not yet reached banks completely. Experts say that the impact of the gradual decrease in interest rates will be seen in the coming months also. Row Kapoor, the co-CEO of Andromeda Sales & Distribution, says that we think the process of cuts cuts is not over yet. If the economic situation is fine, then there can be more relief in the upcoming MPC meetings.
Everyone’s eyes on the RBI meeting of October
Experts associated with real estate hope that RBI can re -cut interest rates in October. Amit Prakash Singh, co-founder of Square Yards, says, if there is another cut before the festive season, shopping and enthusiasm in the market will be encouraged. According to a report by SBI, there may be a total cut of 100 basis points in the entire financial year 2025-26. There has already been a cut of 25 BPS in April and 50 BPS in June, ie 25 BPS is expected to be cut in the next few months.