what is reverse REPO RATE ? EXPLANATION:- As the name suggests, - TopicsExpress

what is reverse REPO RATE ? EXPLANATION:- As the name suggests, Reverse repo rate is “reverse” of Repo rate. So, if SBI chief feels there is not enough demand for loans and most of those 72.25 Rupees are sitting idle, he’ll deposit some of that cash, in RBI. RBI will pay SBI chief 7% interest rate on such deposit. Thus, Reverse repo rate is the interest rate which RBI pays its clients* for their short-term deposits. Note: Reverse Repo Rate is automatically kept 1% less than Repo rate according to new RBI rules. [Since Nov.2010, Reverse Repo rate is constantly 1% less than Repo]

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