RBI likely to raise key policy rates tomorrow

Jul 26, 2010 |

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New Delhi, July 26: The Reserve Bank is likely to increase key policy rates by at least 25 basis points in its first quarterly review of the monetary policy tomorrow to tame inflationary expectations.

"I think there could be a small hike in the repo and reverse repo rate of say 25 basis points," HDFC Managing Director Renu Sud Karnad told PTI.

High inflation may prompt the RBI to tighten money supply by raising both the short-term lending (repo) and borrowing (reverse repo) rates tomorrow, say bankers.

"There is a clear bias for policy rates to move up for the reason that inflation is still very high and inflationary expectation is to be contained. The bias is going to be upward," Union Bank of India Chairman M V Nair said.

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