In a report by Bank of Baroda, it has been said that the Federal Reserve has increased interest rates by 2.25 percent in the year 2022. Due to this there is a possibility that the Reserve Bank may also increase the interest rates more before the stipulated time.
RBI may increase repo rate
The US central bank Federal Reserve has recently increased interest rates. After this the pressure is also on the Reserve Bank of India. reserve Bank of India Also (RBI) can increase the key policy rate repo rate by 0.25 to 0.35 percent. Experts believe that to curb inflation, RBI may increase the repo rate in the review meeting of the monetary policy. The Reserve Bank has already announced to gradually withdraw its soft stance. The three-day meeting of the Reserve Bank’s Monetary Policy Committee (MPC) is starting from August 3. The results of the meeting will be announced on August 5.
It was estimated earlier that RBI may increase the repo rate in the month of August. Loans will become costlier as the repo increases. The EMI of the loan will also increase. This is being seen after the recent repo rate hike. Home loan EMI has already increased. Same is the case with personal loans and auto loans. Retail inflation has remained above the Reserve Bank’s satisfactory level of 6 per cent for six months. In such a situation, the Reserve Bank had increased the repo rate by 0.40 percent and 0.50 percent respectively in May and June.
What is expert opinion
Experts believe that the central bank will take the key policy rate at least this week to the level before Corona. It will increase further in the coming months. We believe that the MPC will increase the repo rate by 0.35 percent on August 5,” said a BofA Global Research report. At the same time, she will gradually harden her stance. The report said that the possibility of an increase in the repo rate by 0.50 percent or a little less than 0.25 percent also cannot be ruled out.
In a report by Bank of Baroda, it has been said that the Federal Reserve has increased interest rates by 2.25 percent in the year 2022. Due to this there is a possibility that the Reserve Bank may also increase the interest rates more before the stipulated time. However, given the circumstances in India, there is no need for a sharp increase, the report says. Housing.com CEO Dhruv Aggarwal said that the Reserve Banks of other countries of the world including America are increasing interest rates rapidly. But the situation is not like this in India. There is no need to raise interest rates accordingly. He said that we estimate that the central bank will increase the interest rates by 0.20 to 0.25 percent.
Radhika Rao, Executive Director and Senior Economist, DBS Group Research, said in a report that we believe that in August, MPC will increase the repo rate by 0.35 percent. The Reserve Bank of India takes into account inflation based on the Consumer Price Index while deciding the policy stance. Retail inflation has remained above 6 per cent since January 2022. In June, it was at the level of 7.01 percent.
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