Aug 3: The ongoing geopolitical tensions leading to supply disruptions and rising inflation may prompt the RBI to adopt ‘wait and watch’ before taking any decision on monetary policy. The consumer price inflation inched up to 4.38percentage in June 2026, above RBI’s comfort level.
The RBI has kept the repo rate unchanged at 5.25percentage in its June MPC.
Experts believe that RBI will keep the repo rate unchanged and instead prioritise growth and liquidity in view of weakening rupee. The real estate sector, too, has been facing a crisis of confidence amidst slowdown in sales over the past several quarters. However, the bright spot remains the re-alignment of demand-supply price point at Rs 1.5-3 crore.
Umesh Gowda H A, chairman and founder of Sanjeevini Group said the upcoming RBI Monetary Policy Committee meeting comes at a time when the global economy is grappling with heightened geopolitical tensions, persistent supply chain disruptions and renewed inflationary pressures, particularly due to rising energy prices.
“In such an environment, we expect the RBI to prioritize macroeconomic stability over monetary easing. A status quo on the repo rate appears to be the most prudent approach. For the real estate sector, stable interest rates provide certainty to both developers and homebuyers, allowing investment and purchase decisions to continue without disruption.”
Echoing similar sentiments, Mukesh Choudhary, Managing Director, Accuspace, a real estate company said the RBI faces the delicate task of balancing economic growth with inflation management amid an increasingly volatile global environment.
“Given the geopolitical risks and the possibility of elevated inflation, we expect the MPC to adopt a wait-and-watch approach. Such a stance would reassure both domestic and foreign investors who value policy consistency during uncertain times. For the real estate sector, especially commercial assets and institutional investments, predictable interest rates are often more valuable than abrupt policy shifts.”
Experts also believe that a measured policy stance by the RBI will reinforce confidence among investors and further strengthen the investment case.
Ankur Jalan, CEO, Golden Growth Fund, a category II Real Estate focussed Alternative Investment Fund said RBI is expected to adopt a cautious and calibrated approach, with a status quo on policy rates being the most likely outcome.
“For real estate-focused AIFs, macroeconomic stability and policy predictability are more critical than short-term rate movements. A stable interest rate environment supports disciplined capital allocation, sustains investor confidence and enables developers to execute projects without facing abrupt increases in financing costs. India's real estate sector continues to benefit from strong structural demand, rapid urbanisation and increasing institutional participation. As long as inflation remains under control and financial conditions remain stable, the sector is well-positioned to attract long-term domestic and global capital.”
Financing cost for businesses assumes significance in such volatile times. Stability shall ensure businesses make investments in order to spur growth and employment.
Lalit Parihar, managing director, Aaiji Group, a Dholera-based real estate firm said RBI is expected to remain cautious and maintain its focus on anchoring inflation expectations.
“While the real estate sector always welcomes lower borrowing costs, preserving economic stability is a larger priority. A measured policy stance will reinforce investor confidence and ensure that financing costs remain predictable. The housing sector today is driven by genuine end-user demand and improved affordability, making it resilient enough to withstand a temporary pause in monetary easing. Once global uncertainties subside, the RBI will have greater flexibility to support growth through calibrated policy measures.”
The Reserve Bank of India's Monetary Policy Committee is scheduled to meet from August 3 to August 5, 2026, with the official interest rate decision and policy announcement set for August 5, 2026.
