RBI’s Accommodative Stance to Continue with Anticipated 25 bps Rate Cut in June Policy Meeting

RBI’s accommodative stance is likely to continue with a 25 basis point repo rate cut anticipated at the June policy meeting and expectations for the repo rate to settle at 5.50 per cent for the remainder of the financial year, further supporting growth and investment.

Laukik Bagwe, Fund Manager & Head – Fixed Income, ITI Mutual Fund says, “The system liquidity is expected to remain ample in Q1 and Q2, driven by the significant RBI dividend and a seasonal drop in currency in circulation.”

With CPI inflation moderating to 3.16 per cent in April and projected to stay below 4 per cent for most of 2025, the RBI is expected to revise its FY26 CPI target down to 3.80 per cent from 4.00 per cent. Strong policy coordination between fiscal and monetary authorities, robust fiscal buffers, and proactive adjustments collectively reinforce India’s outlook for sustained macroeconomic stability and robust growth in FY26.

Affordable financing remains a key driver of demand in real estate, especially in the affordable and mid-income segments.

Ramani Sastri, Chairman and MD, Sterling Developers says, “As we await the upcoming RBI monetary policy announcement, the real estate sector is hopeful for a supportive policy measure with further rate cut as it would be highly encouraging for homebuyers and developers alike. With construction costs on the rise affecting capital flows, lower interest rates would also ease financing pressures for developers.”

Overall, a further rate cut would strengthen market confidence, infuse much-needed liquidity, and also act as a strong signal of policy support for the real estate sector and the broader economy, thereby encouraging investments.

With sustained demand and softening home loan interest rates, the sector’s growth momentum will definitely accelerate further, firmly establishing the real estate sector as a key driver of the nation's economic development.