RBI hikes repo rates by 0.25%
Posted on: 28/Jan/2014 3:16:19 PM
Reserve Bank Governor Raghuram Rajan on Tuesday raised the key policy rate by 0.25 per cent to 8 per cent in a bid to curb inflation, a move that may translate into higher EMIs and push up the cost of borrowing for corporates.
"An increase in the policy (repo) rate by 25 basis points is needed to set the economy securely on the recommended disinflationary path," Rajan said while unveiling the Third Quarter Review of Monetary Policy.
Consequently, the reverse repo rate under the liquidity adjustment facility will be revised to 7 per cent and the marginal standing facility rate and bank rate to 9 per cent.
However, the RBI kept the cash reserve ratio unchanged at 4 per cent as liquidity seems to be comfortable.
