1. What is a Repo Rate?
Repo rate is the rate at which the central bank of a country (Reserve Bank of India in case of India) lends money to commercial banks in the event of any shortfall of funds against the pledge of government securities, to meet their day-to-day obligations. Repo rate is used by monetary authorities to control inflation. A reduction in the repo rate will help banks to get money at a cheaper rate. When the repo rate increases, borrowing from RBI becomes more expensive
