RBI REPO Rate up by 6.5%: Home loans, EMIs to go up
Posted on: 01/Aug/2018 6:26:59 PM
Due to inflation as the main attribute, the Central Reserve Bank of India has increased the REPO rate by 0.25% and now it is 6.50%.
Because of this, it is observed that the loan rates for the other loans such as housing loans will also likely go up as an aftereffect of increase in the REPO rate.
The lending rate offered by the Reserve Bank of India when lending money to the banks is known as Repo rate. In a similar trend, the basic interest rate paid by the Reserve Bank of India from the commercial banks is known as the reverse Repo rate.
Monitoring the inflation rate, RBI revises this interest rate once in 2 months. In this situation, a meeting regarding the decision on the important factors such as interest rates was conducted today (1st August).
The Reserve bank of India has announced that it has increased the Repo rate by 0.35%, With this, the present Repo rate is 6.50%. The Repo rate was last revised 2 months ago by 0.25% to 6.25%. Now, this has become 6.50%.
Reverse Repo will be 6.25%. It is worth noting that the last time the Repo rate was increased twice successively was during 2013. This has been repeated after a gap of 5 years.
RBI has informed that this measure has been taken on account of inflation. In the current financial year, during the 2nd half, the inflation is 4.8%. During the 2019-20 financial year, there are prospects of the inflation going up in the 1st quarter to 5.0%. So, the Repo rate has been revised upwards.
