New Delhi, Feb 8: On Wednesday, the Reserve Bank of India (RBI) governor Shaktikanta Das announced a repo rate hike of 25 basis points (bps), taking the key benchmark interest rate to 6.5 per cent. The MPC’s decision was split 4-2. This is the first rate hike in 2023. Before this, the repo rate was hiked by 35 bps on December 7.
Das also announced that the MPC has decided to withdraw the accommodative stance as the “situation does not look so grim now”. The MPC met on February 6, and the meeting concluded on February 8.
Earlier, a Business Standard poll had predicted a 25 bps rate hike.
The RBI monetary policy guides the bank and lending rates in the economy. If the repo rate is hiked, it is generally followed by a rise in deposit as well as loan interest rates. The same pattern is followed when the repo rate is reduced.