The cut in repo rate has not come at the appropriate time for borrowers who may have to wait and watch if the banks will be able to pass on the benefits after April. A look by BALAJI RAO
The RBI cut the lending rates (repo rate) by 25 basis points or 0.25 per cent in its March 19 credit policy announcements. This was on expected lines but the bad news is that it may not translate into any notable gains for the home loan segment.
With the Cash Reserve Ratio rates untouched this time the cut in repo will bring down the borrowing cost of the banks to meet short-term liquidity requirements.
With the 2012-13 financial year ending in less than a fortnight, banks are not expected to reduce either the deposit rates or the lending rates in a hurry.
Banks usually mop up deposits during each financial year-end in a bid to close their balance sheets on a healthy note and as a practice will offer higher rates on deposits to attract fresh inflows.BALAJI RAO