Bank loans

Bank loans will be expensive due to the rise in key interest rates | Kiran of Udaipur | Latest news from Udaipur

New Delhi: The next meeting of the Reserve Bank of India (RBI) monetary policy committee is due to start on Wednesday.

bank loans

This meeting will continue until August 5, the last working day of this week. After the meeting, the RBI will announce its monetary policy on Friday. The decision to increase the repo rate can be taken again at the meeting of the Monetary Policy Committee. If this happens, all bank lending will also become expensive due to the increased EMI of lending instruments like home and car loans.

The monetary policy committee is expected to announce an increase in key interest rates, in particular the repo rate, by 25 to 50 basis points. If this happens, the repo rate may increase by 0.25-0.50%. After the last policy rate hike, the repo rate is currently at 4.90%, which is expected to increase to 5.15-5.4% this time.

Experts say controlling inflation is currently the RBI’s biggest priority. For this reason, it is considered fixed to raise interest rates on August 5th. It is said that at the next meeting of the Monetary Policy Committee to be held in October, a decision can be taken to raise interest rates again so that inflation can be brought under control.

The RBI has increased the repo rate twice this year. First, in the month of May, the repo rate was increased by 0.4%, while the following month, the RBI again increased the repo rate by 0.50%. As a result, the repo rate rose to 4.90%.