Like other central banks around the world, RBI is raising interest rates to control inflation. The central bank may increase the repo rate by 0.50 per cent in the Monetary Policy Committee (MPC) meeting to be held in June. This will make different types of loans like home-auto loans more expensive.
p style=”text-align: left”>British brokerage house Barclays said in a report that along with raising the repo rate in the June meeting, the central bank may also review its forecast of inflation. Under this, the rate of retail inflation in the current financial year can be between 6.2 to 6.5 percent. However, this rate is still higher than its upper bound of 6 per cent. The brokerage house said in the report that in view of inflation and other challenges, the RBI may also reduce its forecast of economic growth for the financial year 2022-23 from 7.2 per cent to 7 per cent.