RBI policy: RBI hikes rate by 25 bps to 6.25%, but keeps neutral stance

RBI retained its GDP growth projection for 2018-19 at 7.4%

RBI on Wednesday  hiked the key rate for the first time in over four years -- by 0.25 per cent -- to curb inflationary pressure from high oil prices, a move which will translate into higher EMIs for home, auto and other loans.

With all its members voting for the increasing, the 6-member Monetary Policy Committee (MPC) surprised markets by raising the repo rate, at which it lends to other banks, to 6.25 per cent but kept its policy stance as "neutral".

The reverse repo rate, at which it borrows from banks, was also raised by similar proportion to 6 per cent.

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