Monetary policy: If RBI hikes repo rate by 25 bps, how does it impact your EMIs4 min read . Updated: 07 Feb 2023, 08:53 PM IST
- In January 2023 bulletin, RBI said, lending and deposit rates of SCBs have continued to move higher since May 2022 in response to the 225 bps increase in the policy repo rate.
Majority of experts have reckoned a 25 bps rate hike in the last bi-monthly monetary policy of FY23 which RBI will present on Wednesday. This would be the lowest hike in the repo rate for the current fiscal. If a 25 bps is in offing, then deposits and lending rates are likely to go up as well. In a rate hike scenario, the borrowing cost gets higher and banks pass on the impact to borrowers, hence EMIs get costlier. While a rate hike comes as good news for earning attractive rates on fixed deposits.
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