Volume : VII, Issue : IX, September - 2018

IMPACT OF REPO RATES IN THE INDIAN SCENERIO

Rachna Chanyal

Abstract :

RBI concentrates on formulating and executing a healthy monetary policy with clear-cut goals, objectives and tools to be implemented. The paper attempts to study whether policy rates have any impact on Indian scenario or not .To regulate the monetary policy of the economy, RBI imposes various rate policies such as Bank rate or prime lending rate, SLR, CRR, Repo rate and Reverse repo rate, etc.These rates assists the central bank to control buying and lending, safeguarding the investors interests with profitable return .These rates also helps to control inflation .Accelerating inflation and uplifting nation as Asia’s third largest growing economy prompted, the RBI’s six-member committee MPC (Monetary Policy Committee), headed by governor  Urjit Singh Patel, hiked the repo rate under the Liquidity Adjustment Facility by 25bps (basis points) to 6.50 percent  from 1 August 2018. It is the first time since four years that the rates were hiked. The repo rate is the rate at which the RBI lends short-term money to the banks. The central bank also increased the reverse repo rate – rate at which RBI borrows from commercial banks to 6.25 percent. The monetary policy is an important tool for setting the pace of economic activity.

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Article: Download PDF    DOI : https://www.doi.org/10.36106/gjra  

Cite This Article:

Rachna Chanyal, IMPACT OF REPO RATES IN THE INDIAN SCENERIO, GLOBAL JOURNAL FOR RESEARCH ANALYSIS : Volume-7 | Issue-9 | September-2018

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