RBI raises repo rate by 25 bps to 5.50%
In short
The RBI raised the repo rate by 25 basis points to 5.50%. The MPC voted unanimously, and Governor Sanjay Malhotra said rate cuts are not on the table right now.
This can make home loans and other floating-rate loans cost more. Borrowers may see higher EMIs or longer repayment periods, but the exact effect depends on the loan contract.
What the reporting says
The RBI raised the repo rate by 25 basis points to 5.50%, which can lift borrowing costs for consumers with floating-rate loans. The MPC voted unanimously and adopted a stance of calibrated tightening, while Governor Sanjay Malhotra said rate cuts were off the table for now. Existing borrowers may see higher EMIs or longer tenures, but the exact impact depends on their loan benchmark.
Why it matters
The RBI’s 25-basis-point repo rate increase to 5.50% raises funding costs for borrowers with floating-rate loans linked to external benchmarks. Home-loan borrowers are the clearest group affected, with EMIs likely to rise or tenures to extend depending on lender rules. Banks must reset externally benchmarked loans at least every three months. The immediate market question is how fast lenders pass through the hike.