The RBI on Wednesday hiked the key rate for the first time in over four years, by 0.25% to curb inflationary pressure from high oil prices, a move which will translate into higher EMIs for home, auto and other loans.
- The reverse repo rate, at which it borrows from banks, was also raised by similar proportion to 6%.
- This is the first increase in interest rate since January 28, 2014.
- Consumer Price Index (CPI) based retail inflation was projected at 4.6% for the April-September period and 4.7% in second half of 2018-19 fiscal.
New Rates are:
- Repo Rate: 6.25%
- Reverse Repo Rate: 6.25%
- GDP growth outlook: unchanged at 7.4%
- Marginal standing facility (MSF) rate: 6.5%.
- Bank Rate: 6.5%.
