Mumbai: The Reserve Bank of India (RBI) has hiked the repo rate by 50 basis points. The repo rate is increased to 4.9%. The decision was taken by Monetary Policy Committee (MPC) of RBI. This is the second hike in lending rate by the apex bank in last five weeks. The decision was taken to combat rising inflation.
RBI also decided to keep the standing deposit facility, the SDF rate to 4.65% and the marginal standing facility, MSF rate and bank rate, to 5.15%.
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Last month, RBI hiked the policy repo rate by 40 basis points or 0.40% to 4.4%. This was the first increase in the policy repo rate in nearly two years.
Repo rate is the rate at which the Reserve Bank of India lends money to commercial banks in the event of any shortfall of funds. Repo rate is used by monetary authorities to control inflation.
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