RBI MPC Review: The monetary policy review meeting of the Reserve Bank of India (RBI)was held. In which the committee did not change the repo rate for the 10th consecutive time to control the inflation rate. It was decided to keep it unchanged at 6.5%. The central bank cited inflation rate figures and geopolitical tensions as risks to the growth of the economy. However, unlike the last few policy reviews, RBI has changed its stance from liberal to neutral. Based on how the situation unfolds shortly, it indicates that the central bank is ready to go either way, if the inflation rate remains low then we may see a rate cut in the future. However, at present it is a wait-and-watch situation. On this, Bank Bazaar CEO Adil Shetty told where the decision taken in the MPC meeting will have an impact.

Impact on home loans

Home loan borrowers may have to wait a long time for interest rate cuts, possibly till December. If inflation remains under control, interest rates are likely to be cut. Until then, EMIs will remain at current levels.

Effect on FD

For those with fixed deposits (FDs), now is the time to lock in higher rates. Interest rates are expected to fall in the coming months, so it is advisable to secure your returns while you can.

Impact on debt funds

Debt mutual funds should benefit from falling interest rates. As rates fall, the value of bonds in these funds rise, giving investors better returns and now would be a good time to consider them.

Impact on equity funds

The long-term outlook for equity and stock markets is positive. Inflation is under control and the economy is improving, so businesses should perform well. Therefore, equity funds remain a strong choice for long-term investors.