The RBI has kept the repo rate unchanged at 5.25% in its first policy of FY2026, offering relief to home loan borrowers with stable EMIs. But rising inflation risks and global uncertainties mean future rate movements remain uncertain.
April 8, 2026: The Reserve Bank of India on April 8, 2026, held the repo rate unchanged at 5.25% in the first monetary policy announcement of the current financial year. The decision by the RBI’s Monetary Policy Committee (MPC) comes amid the ongoing geopolitical tensions in West Asia and supply chain disruptions.
Repo rate is the interest rate the banking regulator charges scheduled banks in India to lend funds for short-term lending. In that sense, the repo rate directly affects how affordable various loans, including home loans, are for borrowers in the country.
In 2025, the central bank lowered this benchmark lending rate by a cumulative 125 basis points, making home loans considerably more affordable for homebuyers in India at a time when average property prices in the country’s mega residential markets have shown a tremendous upward movement.
How will this move impact home loan borrowers?
The decision to keep the repo rate unchanged at 5.25% is expected to provide stability for home loan borrowers in the near term. Since most home loans in India are linked to external benchmarks, any pause in the repo rate typically means that EMIs are unlikely to change immediately.
The Reserve Bank of India also highlighted that liquidity in the banking system remains comfortable, with a surplus of around ₹2.3 lakh crore. This ensures that banks have enough funds to lend. Also, credit growth has remained strong at 14.3% year-on-year, indicating that banks are still actively lending across segments, including housing.
Vikas Bhasin, Managing Director, Saya Group, highlights that the RBI’s decision to keep rates unchanged supports housing demand and reflects the underlying strength of the Indian economy. While home loan rates remain attractive for now, rising input costs and supply disruptions may push property prices higher in the coming months.
The RBI’s current stance is one of stasis rather than of further rate cuts. For borrowers, this means that while EMIs remain stable for now. Future movements will depend on how inflation evolves in the coming months, especially food and fuel prices. “The economy is confronted with a supply shock. It felt, therefore, prudent to wait and watch the changing circumstances and the evolving growth inflation outlook,” RBI Governor Sanjay Malhotra mentions.
