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The meeting of the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) ended today. Reserve Bank Governor Shaktikanta Das informed about the decisions taken in the meeting and he has announced an increase in the repo rate. Shaktikanta Das has announced a 50 basis point increase in the repo rate. In this way the repo rate has increased by 0.50 percent. In order to control inflation, the central bank is continuously increasing the repo rate. Last month on August 5, RBI had increased the repo rate by 0.50 percent.
increased for the fourth time
Including today’s increase, the central bank has increased the repo rate four times since May. Because of this, the repo rate has now reached 5.90 percent. Earlier it was at 5.40. Shaktikanta Das said that after the shock of the corona virus epidemic and the Russia-Ukraine war, another storm has arisen from aggressive monetary policies by global central banks.
Central banks around the world have increased interest rates to control inflation. The US Fed Reserve raised interest rates by 75 basis points in a row. Due to this the pressure on the rupee had increased.
GDP growth forecast
The central bank has also reduced its GDP growth forecast for the financial year 2022-23 (FY23) from 7.2 per cent to 7 per cent. Shaktikanta Das said that today inflation is hovering around 7 percent. We expect it to remain at 6 per cent in the second half of the year.
loan will be expensive
After the increase in the repo rate, the loan will become expensive, because the borrowing cost of the banks will increase. After this the banks will pass the burden on their customers. Apart from home loans, auto loans and other loans will also become expensive. Repo rate is directly related to the loan and EMI taken from the bank. Actually, repo rate is the rate at which RBI gives loans to banks.
inflation rate in the country
The retail inflation rate in the country has remained above the target limit set by the Reserve Bank of India (RBI) for the eighth consecutive month. If we look at the data of retail inflation released in the past, it has once again reached 7 percent in August. Earlier in the month of July, there was a decrease in retail inflation and it had come down to 6.71 percent.
