The results of the meeting of the Monetary Committee of the Reserve Bank of India (RBI) were announced on Wednesday. Announcing the results, Governor Shaktikanta Das said that in the meeting it was decided to increase the policy interest rates or repo rates by 50 basis points or 0.50 percent. That is, the repo rate will increase from 4.40 to 4.90. This will increase the EMI burden of the loan.
higher than expected:
It is worth noting that earlier in the month of May, in order to control the rising inflation in the country, the RBI had organized a meeting of MPC without prior notice and in this it was announced to increase the repo rate by 0.40 percent.
After this, after staying at a historic low of 4 per cent since 2020, these rates suddenly increased to 4.40 per cent. After this increase, the RBI governor had also already indicated that the repo rates could be increased further in the meeting to be held in June.
Rising inflation cited:
Declaring the results taken in the MPC meeting, Das said that inflation is increasing continuously in the country and the supply chain has been badly affected due to global developments. To control this rising inflation, the RBI has to take strict steps.
Significantly, retail inflation in the country reached an eight-year peak in April, reaching 7.79 percent, while wholesale inflation has crossed 15 percent. Along with this, he also mentioned about the rising prices of crude oil and the skyrocketing of tomato prices in the country.
MSF rises to 5.15%:
The RBI governor said that the Russia-Ukraine war has played an important role in the rise in inflation. But despite this, the country’s economy is on the path of recovery. Along with the hike in repo rates, RBI has raised MSF by 50 bps to 5.15 per cent, standing deposit facility (SDF) to 4.65 per cent.
Other loans including home-auto are expensive:
After this decision of RBI, the customers taking loans have suffered a major setback, because due to the increase in repo rates, all types of loans including home, auto and personal loans will become expensive and the EMI of the customers will increase.
That is, now EMI will cost more money than your pocket. Governor Shaktikanta Das has said that so far as the geo-political situation has arisen, it was very important to take such a decision in the midst of it.
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