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Mumbai: Many big countries including America have decided to increase their interest rates. Against that backdrop, a decision on whether the RBI will now raise its interest rates will be taken on Friday. RBI The monetary policy meeting of the U.S. has started on Wednesday and a decision will be taken on it at 10 am on Friday.

The credit policy to be announced on Friday will be the first credit policy of this financial year. According to economists, the RBI is unlikely to increase the repo and reverse repo rates this time. Given the current rate of inflation, RBI may raise its inflation forecast. There is a picture of steep rise in the prices of edible oil, fuel and vegetables in the country.

The Reserve Bank has not changed interest rates for 10 consecutive times. At present the repo rate is 4 per cent, while the reverse repo rate is 3.35. Meanwhile, RBI Governor Shaktikanta Das had projected GDP growth at 7.8 per cent in the fiscal year 2022-23.

What is Repo Rate?
Repo rate is the rate at which banks borrow money from the Reserve Bank. An increase in the repo rate means an increase in the lending rate to the banks, while a decrease in the repo rate means that the bank gets cheaper money. This means that if the RBI raises the repo rate, then all banks have the option of increasing the lending rates for the customers. As it decreases, the interest rate decreases.

 

What is reverse repo rate?
Reverse repo rate is the exact opposite of repo rate. Banks borrow money from the Reserve Bank, just like the Reserve Bank borrows money from these different banks. So the rate charged for the same is called reverse repo rate.

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