RBI Policy: Home and Car Loan EMI will increase again? Reserve Bank’s MPC meeting begins, know how much the repo rate will increase
RBI Policy: With the beginning of the month of August, the heart beats of home loan borrowers have started accelerating. The meeting of the Monetary Policy Committee of the Reserve Bank of India has started on Wednesday. Central bank governor Shaktikanta Das will announce policy decisions on August 5.
For the last two times, the Reserve Bank has increased the repo rate by 90 basis points. In view of inflation and falling level of rupee, this time also it is expected to increase by 35 to 40 basis points.
By how much can the repo rate increase
According to experts, an increase of 0.35 percent in interest rates is considered fixed. On the other hand, some experts are expecting an increase of 0.25 to 0.35 percent. The inflation rate has been above the target set by the central bank for several months in a row. In such a situation, the inflation of your home and car loan can also skyrocket once again in August.
90 basis point increase in 2 bars
The Reserve Bank had also expressed concern over inflation in the last meeting. The retail inflation rate in the country is still over 7 per cent. If the central bank increases the repo rate, then banks can increase the interest rate on the loan. The Reserve Bank had increased by 0.40 per cent in May and 0.50 per cent in June. After the continuous increase, the repo rate has gone up to 4.90 percent.
fear of uncontrollable inflation
The rate of inflation in the country has remained consistently higher than the Reserve Bank’s fixed limit of 6 percent. Inflation in June was 7.01 percent. This is less than the figure of May but still it is more than the fixed limit. Retail inflation stood at 7.04 per cent in May. Whereas earlier in April it was 7.79 percent. Food inflation stood at 7.75 per cent in June, which was recorded at 7.97 per cent in May.
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