In the press conference after its bi-monthly meeting that ended on Wednesday, the Central Bank told that the repo rate has been increased again. This time there has been an increase of 50 basis points (0.50 per cent). RBI said that it was necessary to do this to control the rising inflation.
Reserve Bank of India (RBI) has again increased the repo rate. This time there has been an increase of 50 basis points (.50 per cent). The repo rate has increased to 4.90 percent. The Central Bank gave information about this in a press conference after its bi-monthly meeting that ended on Wednesday. With the increase in the repo rate, all types of loans will now be available at expensive rates and the burden of EMI on the common man will be more than before.
While the RBI has increased the policy repo rate by 50 basis points to 4.90%, the permanent deposit facility (SDF) rate has been increased from 4.15% to 4.65% and the marginal standing facility (MSF) rate and bank rate from 4.65% to 5.15%. Adjusted on.
The effect of this decision of RBI was also seen on the stock market. The market fell immediately after the morning’s opening gap-up. After this, when the announcement was made about the increase in the press conference, there was a lot of sharp volatility in the market.
Let us tell you that last month, on May 4, 2022, RBI surprised everyone by increasing the policy repo rate by 40 basis points to 4.40%, while the permanent deposit facility (SDF) rate was reduced to 4.15% and the marginal standing facility (MSF) rate and banks. The rate was adjusted at 4.65%.
Till yesterday, various financial institutions were projecting growth in the range of 25 to 50 basis points. The country’s largest private bank HDFC Bank had said in its report that the central bank can increase by 25 basis points.
What will be the effect of this increase
- The increase in the repo rate by the RBI will increase the EMI of other loans like home and car loans. The reason for this is that banks will pass the burden of the increased repo rate directly on the customers.
- The effect of increasing the repo rate will also affect the savings bank account and FD. Banks can increase the interest rate on your savings account and fixed deposits. As on May 4, after the increase in the repo rate, all the banks have increased the interest rate on fixed deposits.
- In order to control the rising inflation, central banks also increase the repo rate. With the latest increase in the repo rate, it can be expected that inflation will be controlled.
- The biggest impact of increasing the repo rate will be on the industry, because for them also the loan and interest rates will increase as compared to before.
