Reserve Bank increased the repo rate by 0.25 percent to 6.5 percent
The Reserve Bank of India (RBI) has increased the policy repo rate by 0.25 percent in the bi-monthly monetary policy review with the aim of bringing inflation under control.
An overview of the news:
After which the new repo rate has increased to 6.50 percent.
The Gross Domestic Product (GDP) growth forecast for the current financial year 2022-23 has been increased by RBI from 6.8 percent to 7 percent.
At the same time, in the next financial year 2023-24, the growth rate in gross domestic product (GDP) has been estimated to be 6.4 percent.
RBI has estimated retail inflation to be 6.5 per cent in the current financial year and 5.3 per cent in the next financial year.
In order to bring inflation under control, the repo rate has been increased by 2.50 percent in total six times since May this year.
Repo rate is the interest rate at which commercial banks borrow money from the central bank to meet their immediate needs.
An increase in this means that borrowing from banks and financial institutions will be costlier and the monthly instalment (EMI) of existing loans will increase.
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