- Hindi News
- Business
- RBI Repo Rate Hike Announcement | Sanjay Malhotra Interest Rates EMI Impact
7 minutes ago
- copy link
If you are thinking of taking a loan for house, car or personal needs, then the burden may increase in the coming days. This is because RBI can increase the repo rate from 5.25% to 5.50%. If the repo rate increases, it will happen for the first time in 4 years.
After the three-day meeting of RBI’s Monetary Policy Committee, i.e. MPC, Governor Sanjay Malhotra will give information about the new interest rates today on October 7.
However, not all banks keep the interest rates the same as prescribed by RBI, they can make slight changes in it considering their costs and the market.
Now know the important things related to repo rate by answering 3 questions.
Question 1: What is repo rate?
answer: Repo rate is the interest rate at which RBI gives short term loans to banks. On the basis of this rate, banks decide the interest rate of their loans. RBI’s Monetary Policy Committee, i.e. MPC, reviews it every two months.
Question 2: What effect does changing repo rate have on EMI?
answer: If the repo rate increases, loans become expensive for banks. In such a situation, banks also make loans expensive. At the same time, if the repo rate decreases, there is a possibility of the loan becoming cheaper and EMI reducing. However, this affects only those loans whose interest rate is linked to the repo rate.
Question 3: What is the relation between repo rate and inflation?
answer: When inflation increases, RBI often increases the repo rate or does not reduce it. This makes loans expensive for banks. Banks also charge higher interest on loans.
In such a situation, people take less loans and also spend less. This helps in controlling inflation. At the same time, when inflation is low, RBI reduces the repo rate. This makes loans cheaper and people spend and invest more.
Interest rate did not change in 3 meetings in 2026
There have been 3 RBI meetings so far in 2026. In all the three meetings held in April, June and August, the repo rate was kept at 5.25%. That means there was no change in the interest rate for the third consecutive time.
Earlier in 2025, RBI had reduced the interest rate thrice, giving relief to the people. The repo rate was raised to 6.00% in April, 5.50% in June and 5.25% in December. Since then, RBI has not made any change in the interest rate keeping in view the inflation and world situation.
Source link
[ad_3]
