The new rates vary from 8.80 to 9.05 per cent on various slabs of loans.
'You will see him frequently asking customers -- especially retail -- about service experience, pain points, areas of improvement and suggestions.'
The Reserve Bank of India on Wednesday evening increased the repo rate -- the rate at which the central bank's lends short-term money against government securities to banks -- by 25 basis points to 8 per cent.
Former RBI governor Raghuram Rajan on Monday said the central bank will have to raise interest rates to tame inflation and the hikes need not be considered by politicians and bureaucrats as some "anti-national" activity. Known for his frank views, Rajan also said it was important to remember that the "war against inflation" is never over. "Inflation is up in India. At some point, the RBI will have to raise rates, like the rest of the world is doing," he said in a LinkedIn post.
While most borrowers calculate the gain they stand to make from switching to a lower interest rate, they often fail to take into account all the costs.
Due to tight liquidity condition, RBI would cut cash reserve ratio.
Industry houses are emphatic with the RBI pruning repo rate and CRR by 0.25 per cent each after a long nine months in its third quarter monetary policy review.
Institutional investments in Indian real estate have seen a strong start to 2025, with inflows reaching $ 1.3 billion in the first quarter - a 31 per cent year-on-year (YoY) increase. This growth was primarily driven by domestic investments, which accounted for 60 per cent of the total inflows during the quarter. With $ 0.8 billion inflows, domestic investments saw a 75 per cent annual rise and were largely focused on industrial & warehousing and office segments.
Housing sales are likely to be hit, especially in affordable and mid-income categories, following the RBI's decision to hike repo rate, according to real estate developers and consultants. However, the impact of RBI's decision to raise the benchmark lending rate by 50 basis points to 5.40 per cent is expected to be for a short term, they added. This is the third consecutive rate hike after a 40 basis points and 50 basis points increase in May and June, respectively.
The highlights of RBI's bi-monthly monetary policy announced by Governor Shaktikanta Das:
With interest rates rising there are doubts if teaser rate home loans offered by banks will come to an abrupt halt.
The central bank has hiked however reverse repo rate by 0.25 per cent.
Two days after the repo rate cut, the Reserve Bank of India governor Bimal Jalan on Monday said the soft interest rate bias will continue.
Analysts feel the RBI should not opt for another hike in the calendar year.
Wholesale inflation fell to a 4-month low of 1.31 per cent in August due to a decline in prices of vegetables and fuel, even though onion and potato prices spiked, according to official data released on Tuesday. Wholesale price index-based inflation fell for the second straight month in August after it hit a high of 3.43 per cent in May. Inflation in July was 2.04 per cent. In August last year, WPI inflation was (-) 0.46 per cent.
RBI Governor D Subbarao aims to revive growth by increasing the flow of credit through reduction in policy rates. By reducing the repo rate by another 25 basis points, he is hinting at a further reduction in interest rates. And, through the 25 bps cut in reverse repo rate, he is trying to make it less remunerative for banks to park surplus liquidity with the central bank and instead prodding them to lend more to the productive sectors.
The Reserve Bank of India (RBI) has given HDFC Bank six months to migrate HDFC's home loan customers to external benchmark linked lending rate (EBLR), top sources in the bank told Business Standard. Almost half of HDFC's 5.4 million customers are home loan customers. It is mandatory for banks to link retail loans and loans to micro, medium and small enterprises to an external benchmark. Non-banking financial companies do not have such a mandate.
The central bank had nudged banks to cut lending rates.
The banking system's liquidity slipped into deficit for the first time in the current financial year (2023-24) due to the imposition of the Incremental Cash Reserve Ratio (I-CRR) for banks and outflows from goods and services tax (GST) payments, according to dealers. Reserve Bank of India (RBI) data shows it injected Rs 23,644 crore on August 21. The last time liquidity was in deficit was on March 27, when the RBI injected Rs 45,575 crore.
RBI ups inflation target to 7 per cent from 6 per cent projected earlier.
Declining price of vegetables pulled down inflation to over three-year low of 5.96 per cent in March, core inflation moderated to 3.5 per cent and food price inflation also eased to 8.2 per cent, which is likely to prompt the RBI to consider a rate cut in its annual monetary policy next month.
The government on Thursday kept interest rates unchanged on small savings schemes, including NSC and PPF, for the second quarter of 2022-23 amid high inflation and rising interest rate. The interest rate on small savings schemes has not been revised since the first quarter of 2020-21. Public Provident Fund (PPF) and National Savings Certificate (NSC) will continue to have an annual interest rate of 7.1 per cent and 6.8 per cent, respectively, in the second quarter of this fiscal.
It is to be seen if SBI under Setty, who will have a three-year term, can ride the economic cycle to take SBI to new heights, navigating some of these challenges.
"In view of the festival season and extending the benefits to customers across all segments, we have reduced our MCLR by 10 bps across all tenures," the bank said in a statement.
With RBI's repo rate cut and strong macroeconomic fundamentals like benign inflation, strong forex reserves and stable rupee, GDP growth is expected to be higher and interest rates are poised to touch new lows, PNB Gilts has said.
Cash Reserve Ratio (CRR) is the amount of funds that the banks have to keep with the Reserve Bank of India. If RBI decides to increase the percent of this, the available amount with the banks comes down. RBI is using this method (increase of CRR rate), to drain out the excessive money from the banks.
'Banks are being encouraged to lend instead of parking their resources with the RBI and earn risk-free interest income,' points out Tamal Bandyopadhyay.
HDFC Bank has hiked its benchmark prime lending rate (BPLR) by 0.25 per cent to 15.25 per cent with immediate effect.
Amid speculations that home and personal loan rates may go up, government said on Wednesday the 0.25 per cent hike in Reserve Bank of India's short term lending rate is not intended to make loans costlier but to make banks self sufficient.
Shares of state-owned bank stocks were under pressure on Monday due to muted deposit and credit growth numbers reported by these lenders in the October-December quarter (Q3) of 2024-25 (FY25). The Nifty PSU Bank index was down 4 per cent, with Union Bank of India emerging as the biggest loser as its shares fell 7.5 per cent to close at Rs 114.7, followed by a 5.7 per cent drop in shares of Bank of Baroda (BoB) to Rs 228 and a 4.7 per cent slide in shares of Bank of India to Rs 99.8 on the National Stock Exchange.
Encouraged by softening inflation, the RBI on Thursday decided to cut the benchmark interest rate by 0.25 per cent to 7.75 per cent with a view to boost growth.
The returns from liquid funds, currently, look better than what savings accounts of leading banks are offering, points out Sarbajeet K Sen.
RBI cuts GDP growth projection to 6.6 per cent for current financial year, from earlier forecast of 7.2 per cent.
'Banks will continue to increase FD rates to attract more deposits and meet the increasing demand for credit.'
The Reserve Bank of India has directed banks to set aside more capital to cover risks on advances to realty sectors and has raised repo rate by 0.25 per cent to 7.50 per cent .
The bank kept cash reserve ratio unchanged at 6 per cent.
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