Bank of Baroda hikes benchmark lending rate by 0.1% to 8.4% for 1-yr tenure

The revised marginal cost of funds based lending rate benchmarks are effective from April 7

A day after RBI opted for status quo in its monetary policy, state-owned Bank of Baroda (BoB) hiked benchmark lending rate by 0.1 per cent or 10 basis points, making loans expensive.

The bank has raised marginal cost of funds based lending rate (MCLR) by 0.1 per cent to 8.40 per cent for 1-year tenure, BoB said in a statement.

Similar cut has been made effective in other tenures, it said.

The revised MCLR benchmarks are effective April 7, it added.

The hike will push interest rates on home and other loans linked to one-year MCLR by 10 basis points.

In its first bi-monthly policy review of 2018-19, the Reserve Bank on Thursday kept the key interest rate unchanged but cut the inflation forecast on lower food prices, sparking a rally in stocks and bond markets.

The Monetary Policy Committee, headed by RBI Governor Urjit Patel, revised upwards its forecast of real GDP growth from 7.2 per cent to 7.4 per cent, which the ministry said is "broadly in line with the forecast in the Economic Survey".

It further said, "inflation in fourth quarter of 2017-18 has been revised downwards from 5.1 per cent to 4.5 per cent.