The interest rate at which commercial banks borrow money from the Reserve Bank of India (RBI) by selling their securities under a repurchase agreement is called the Repo Rate. It is a key monetary policy tool used by the RBI to control liquidity and inflation in the economy. The Reverse Repo Rate is the rate at which the RBI borrows money from banks.
What is the interest charged by the RBI on the money borrowed from it by the various banks called ?
Asked in MPSC CS Prelims 2012 · Topic: Money & Banking (Monetary Policy: Objectives, Instruments (quantitative and qualitative), and Transmission Mechanism)
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