How the homelon seekers reduce their interest when rbi repo decrease?
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Hello friends.
- The repo rate, or the rate at which banks borrow money from the RBI, was reduced by 25 basis points to 6.25%. ... Typically, as the repo rate is reduced and borrowing costs for banks go down, they pass on the benefits to consumers by reducing interest rates on loans.
- Effects : An increase in the reverse repo rate will decrease the money supply and vice-versa, other things remaining constant. An increase in reverse repo rate means that commercial banks will get more incentives to park their funds with the RBI, thereby decreasing the supply of money in the market.
- Many industry analysts expect the average rate for 30-year fixed mortgages to hit 5 percent in 2019. Currently, it's around 4.7 percent. The 10-year Treasury yield — which mortgage rates tend to follow — could rise close to 3.5 percent before falling back down to 2.45 percent by the end of 2019, McBride says.
hope it's helpful for you...
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Answer:
Loafers RBI lowest repo rate from 6.5% to 6.25% , the economic value of this statement from viewpoint of economy :-
0.25 percentage point rate cut as the real interest rate in India right now is very high. "It is high time time to ease monetary policy,"
BANK RATES WILL BE EASY
LAOAN AMOUNT WILL INCREASE
MORE MONEY, MORE PRODUCTION,MORE INCOME GENERATION
INCREASE GDP
REDUCTION OF POVERTY
STANDARD OF LIVING IMPROVE
INFRASTRUCTURE WILL IMPROVE
FOREIGN COMPANIES WILL ATTRACT TOWARDS INDIA
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