In addition to the repo rate cut, the Standing Deposit Facility (SDF) and Marginal Standing Facility (MSF) rates have also been reduced by 25 bps to 6% and 6.5%, respectively. The bank rate has also been adjusted to 6.5%.

The Reserve Bank of India (RBI) reduced its key repo rate on Friday for the first time since May 2020, aiming to provide stimulus to the sluggish economy, which is projected to grow at its slowest pace in four years during the current fiscal year.

Usually, a reduced repo rate set by the central bank helps the real estate sector. However, most banks will only reflect those changes in lending rates after two to three months, and during this period, even a basic reduction of twenty-five basis points will change home loan repayments.