Introduction

Last week the Reserve Bank of India raised its key repo rate by 25 basis points to 6.50%. This is the sixth rate hike since last May, for a total hike of 250 basis points in less than a year. The latest hike, while not entirely unexpected in some quarters, came as a surprise to those who were hoping for a pause in the consecutive rate hikes, especially given that inflation pressures were seen to be moderating.

But the rate hike has also sparked a debate about its effect on FD rates, home loan interest rates and EMIs, and in turn, the impact on demand in the real estate market. In this episode of InFocus, we try and decode the implications of the rate hike, especially from the consumer’s point of view. 

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