What is RBI policy rate?

Before telling you about the current RBI policy rate, let me tell you that RBI monetary policy is the policy formulated by the RBI for regulating the money matters of India. This policy takes into account the credit distribution among users as well as the rate of interest on lending and borrowing.

This monetary policy plays an important role in boosting the economic growth of our country since we’re a developing country. This policy includes measures taken to regulate the supply of money, control inflation, etc. Several instruments of monetary policy include variations in bank rates, currency supply, other interest rates, and more

Moreover, the

current repo rate

, bank rate, marginal standing facility rate, and reverse repo rate also come under the Reserve Bank of India’s Monetary Policy.

On 04-05-2022, the Reserve Bank of India kept the Repo Rate unchanged at 4.40% and the Reverse Repo rate at 3.35%. Moreover, the Bank rate and Marginal Standing Facility rate stand at 4.25%. This has been done to minimise the damage caused to the economy by the 2

nd

wave of coronavirus.

Now you know what is RBI policy rate.

• Benchmark lending rate kept unchanged at 4% for the tenth time in a row, reverse repo rate stands at 3.35 percent.

• E-RUPI digital voucher cap increased from Rs. 10000 to Rs. 1 lacs and multiple-use permitted.

• Projects the growth of GDP at 7.8 pc for next fiscal.

• Retail inflation is projected at 5.3 pc for the present fiscal, 4.5 pc in Financial Year 2023.

Now you know is policy rate of RBI.

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