FIRST HIKE SINCE AUG 2018

4.4% New repo rate ↑40 basis points

In August 2018, repo rate increased from 6.25% to 6.5%. The repo rate (at which RBI lends to banks) saw a sharp reduction in March 2020 to 4.4% due to the pandemic, and then RBI reduced it to 4% in May 2020

4.5% cash reserve ratio ↑50 basis points

CRR is the minimum share of deposits which banks have to keep with RBI and thus an increase in this has the effect of sucking liquidity from the market

₹90,000cr

the money the hike is expected to draw in liquidity from the market