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RBI increases repo rate by 0.25 percent, EMI of home loan will increase

Governor of the RBI Shaktikanta Das has begun his news conference. There has been a 0.25 percent increase in the repo rate by the RBI. The repo rate has gone up to 6.50% from 6.25%.

This is the sixth time the central bank has raised the repo rate. Following that, Shaktikanta Das made these comments in a media interview to provide information on the meeting and the decisions made at that time.

RBI Governor Shaktikanta Das announces that RBI increases the repo rate by 25 basis points to 6.5% pic.twitter.com/2ZyUSbCxEO
— ANI (@ANI) February 8, 2023

EMI of home loans will increase

The central bank’s decision will result in an increase in the house loan‘s EMI. The EMI for a home loan, a car loan, and a personal loan will all be more expensive as a result of the hike in the repo rate. Inform them that the repo was 4% in May 2022 and is currently 6.5%.

RBI governor said

The RBI governor stated that with major nations’ growth prospects improving and inflation levels declining, the prognosis for the world economy is not as bleak as it was a few months ago. However, major economies continue to experience inflation that is beyond the target. According to the governor of the RBI, the annual inflation rate may stay at 5.6% in the final three months of the fiscal year. In the first quarter of FY24, the RBI governor expects the consumer price index to rise by 5%.

Shock to the public before Diwali, loans will become expensive, RBI hikes repo rate

The repo rate has been raised by 50 basis points by the Reserve Bank of India (RBI). Your EMI will likewise increase in price as a result. The current repo rate is 5.90%, up from 5.40%, while the SDF rate is 5.65%, up from 5.15%. Five of the six MPC members supported raising the rates. According to the RBI, all sectors continue to be concerned about inflation. Earlier, the interest rate was raised by a number of significant central banks throughout the world, including the US Federal Reserve.

RBI Governor Shaktikanta Das announces that RBI "increases the policy repo rate by 50 basis points to 5.9% with immediate effect." pic.twitter.com/YpDjOVsgus
— ANI (@ANI) September 30, 2022

Repo rate increased by 1.90 percent since May

The RBI had previously indicated raising the repo rate by 0.50-0.50 percent twice in June and August based on the MPC’s recommendations. The central bank abruptly raised the interest rate by 0.40 percent earlier in May. This indicates that since May, the repo rate has grown by 1.90 percent.

Future loans will be more expensive

The cost of borrowing will rise if the repo rate rises. Loans will grow more expensive in the future if banks find money to be pricey. Customers will feel the effects through banks. The sale of homes is anticipated to rise further as a result.

Loan became expensive for SBI customers, the bank again increased the interest rates

The cost of taking out any kind of loan from SBI has increased. The bank has raised interest rates once more. State Bank of India (SBI) has announced plans to raise the benchmark prime lending rate (BPLR) by 70 basis points, or 0.7%, according to information obtained from the bank’s website. SBI’s BPLR has now increased to 13.45 percent as a result. The new tariff is in place as of right now, September 15th.

According to experts, SBI made this adjustment in anticipation of a potential hike in the repo rate in the monetary policy. It is possible that the RBI will raise the repo rate by 50 basis points in its monetary policy for September. The likelihood of a repo rate increase has grown further as a result of the increase in retail inflation.

Borrowers will be burdened in this way

The EMI for both new and existing customers will rise as a result of SBI’s higher BPLR. The loan payments will therefore be greater than before. Banks will raise the loan’s interest rate. SBI last modified the BPLR in the month of August. It is interesting to note that earlier banks used to base customer loans on the previous benchmark. Nowadays, the majority of banks base their loan rates, or EBLRs, on external benchmarks.

Consumers borrowing for their homes and cars will be most affected by this bank’s decision. Many people around the nation borrow money from SBI for cars and homes. The EMI burden will also fall on anyone looking to purchase a home or automobile during the festival season.

Up to 50 basis points increase in August

The regular lending rates at the State Bank of India (SBI) were increased by 50 basis points in August (or half a percentage point). SBI increased the lending rate a few days after the Reserve Bank of India (RBI) increased its benchmark lending rate by 50 basis points to curb inflation. The external benchmark-based lending rate (EBLR) and repo-linked lending rate (RLLR) both experienced rises of 50 basis points in addition to the 20 basis point increase in the marginal cost of funds-based lending rate (MCLR) for all tenors.

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