Repo rate Discount rate at which a central bank repurchases government securities from the commercial banks, depending

on the level of money supply it decides to maintain in the country's monetary system. To temporarily expand the money supply, the central bank decreases repo rates (so that banks can swap their holdings of government securities for cash), to contract the money supply it increases the repo rates. Alternatively, the central bank decides on a desired level of money supply and lets the market determine the appropriate repo rate. Whenever the banks have any shortage of funds they can borrow it from RBI. Repo rate is the rate at which our banks borrow rupees from RBI. A reduction in the repo rate will help banks to get money at a cheaper rate. When the repo rate increases borrowing from RBI becomes more expensive. The rate charged by RBI for its Repo operations is 5.75% and Reverse Repo rate is 3.25%. When RBI lends money to bankers against approved securities for meeting their day to day requirements or to fill short term gap.It takes approved securities as securityand lends money.These types of operations are generally for overnight operations. ========================

Updating today-27th of March 2010-for ur SBI clerk interview. ------------------------------------------------------------------------------

The Reserve Bank of India (RBI) has hiked the repo and reverse repo rate by 25 basis points (100 bps=1%). The new repo and reverse repo rate is 5% and 3.5%, respectively. The hike comes into effect immediately.

What is the meaning of repo rate by RBI of India?

Discount rate at which a central bank repurchases government securities from the commercial banks, depending on the level of money supply it decides to maintain in the country's monetary system. To...
What is the curent repo rate and reverse repo rate in india?

if it wants to make it cheaper for banks to borrow money.5%) What is crr rate by rbi if india? 5% in december 09 Can the repo rate decrease the inflation of India? Not directly. It. and vice-versa. If the bank rate moves up. First.. long-term interest rates also tend to move up. Here's a high level version in plain English..5%(down 0.25% . Difference between repo rate and overnight rate? Referencing the monetary policy is usually when these two rates are compared.. Bank Rate This is the rate at which RBI lends money to other banks (or financial institutions) The bank rate signals the central bank's long-term outlook on interest rates.50%. If the RBI wants to make it more expensive for the banks to borrow money. The overnight rate is the interest rate.The current Repo Rate is 5. definitions. Present repo rate in India? 7.. Banks make a profit by borrowing at a lower rate and lending the same funds at a higher rate of interest..Any one can easily get this (Rate) information at RBI home page right hand side under heading. while the repo rate is the rate at which the Central Bank pumps in shortterm liquidity. Difference between the repo rate and reverse repo rate? The reverse repo rate is the rate at which banks park their short-term excess liquidity with the Central Bank. hikes its own lending rates to ensure it continues to make a profit. it reduces the repo rate. in turn.75% and that of Reverse Repo Rate is 4. it increases the repo rate. called . If the RBI hikes the bank rate. the interest that a bank pays for borrowing money (banks borrow money either from each other or from the RBI) increases. While the Bank Rate is 7. similarly. Difference Repo or Repurchase rate is the rate at which banks borrow funds from the RBI to meet the gap between the demand they are facing for money (loans) and how much they have on hand to lend.

. .... What is the difference between rates and taxes? This would depend on how the words are used.The federal income tax marginal tax rates (brackets) would be the percentage amount that is applied to each bracket amount of income for that filing.. What is the difference between rate and yield? Rate is the specified interest rate paid on a financial instrument (such as a bond). The interest is calculated by applying the rate to the face value of the instrument. The yield is calculated by.the..