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RBI hikes interest rates by 0.25 per cent to bring it to 6.5 per cent; loans and EMIs to get costlier

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The Reserve Bank of India (RBI)

Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) on Wednesday, August 1, raised the interest rate by 0.25 per cent on inflationary concerns.

In its third bi-monthly policy of the current fiscal, the RBI decided to raise benchmark repo or the short term rate at which it lends to other banks by 25 basis points, or 0.25 per cent, to 6.5 per cent.

The reverse repo rate – rate at which the RBI borrows from commercial banks – under the liquidity adjustment facility (LAF) stands adjusted to 6.25%  and marginal standing facility rate and Bank Rate to 6.75%.

The RBI cited rising crude oil prices, volatility in global financial markets, and uncertainty around the full impact of MSP (minimum support price) on inflation among the key factors for its rate-hike decision.

However, the 6-member MPC headed by RBI Governor Urjit Patel kept its stance at neutral. For July-September, it pegged CPI-based retail inflation at 4.2 per cent which it saw firming up to 4.8 per cent in the second half of the current fiscal, media reports said.

The projected inflation rate is above its targeted comfort level of 4 per cent.

RBI kept the GDP growth forecast for the current fiscal unchanged at 7.4 per cent and saw it at 7.5-7.6 per cent in the second half of the current fiscal.

The hike in June was the first time the benchmark lending rate was raised in over four years. This is now the first time since October 2013 that the central bank has raised the repo rate at two consecutive policy meetings.

For those who have taken loans from banks, the RBI’s latest development has come as a bad news. The hike would make home, car loan EMIs costlier.

Experts were surprised with RBI’s neutral stance, reported NDTV. “The hike was expected, but what is surprising is the stance has remained ‘neutral’. We were expecting that since this is the second consecutive hike in two policies, the stance would be changed to ‘tightening’,” Anagha Deodhar, Economist, ICICI Securities was quoted as saying.

RBI projected inflation at 4.6 per cent in second quarter of fiscal 2019, 4.8 per cent in second half of 2018-19 and 5 per cent in first quarter of 2019-20. In June, RBI had projected consumer inflation at 4.8-4.9 per cent in the first half and 4.7 per cent in the second half of 2018-19.

Annual consumer inflation hit 5 per cent in June, the eighth straight month it topped the RBI’s medium-term 4 percent target.

The next MPC meet which will be during the festive season may not see a rate increase. The next meeting of the MPC is scheduled from October 3 to 5, 2018.

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Yogi Adityanath takes a dig at Akhilesh Yadav over Ram Temple visit plan

Yogi Adityanath’s remarks came after the Samajwadi Party announced that Akhilesh Yadav would visit the Ram Temple in Ayodhya on December 12.

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Yogi Adityanath

Uttar Pradesh Chief Minister Yogi Adityanath on Saturday took an apparent swipe at Samajwadi Party chief Akhilesh Yadav over his planned visit to the Ram Temple in Ayodhya, saying those who had fired on Ram devotees should first apologise to them and to the saints.

Yogi made the remarks while addressing the 10th edition of Deepotsav in Ayodhya. He did not name Akhilesh Yadav directly.

Yogi’s remarks come after Akhilesh’s Ayodhya visit plan

The chief minister’s comments came after the Samajwadi Party announced that Akhilesh Yadav would visit the Ram Temple in Ayodhya on December 12. It would be his first visit to the temple since its inauguration, according to the report.

Yogi said those who had earlier neglected and insulted Ayodhya, opened fire on Ram devotees and subjected saints to lathicharge should come to the city only after seeking forgiveness.

“Let them apologise to the devotees of Lord Ram; let them apologise to the saints,” Yogi said, adding that they should repent for their past actions.

Reference to 1990 firing on kar sevaks

Yogi’s remarks referred to the 1990 police firing on kar sevaks during the Ram Janmabhoomi movement. At the time, the Uttar Pradesh government was headed by Mulayam Singh Yadav, Akhilesh Yadav’s father.

The chief minister said those who had once “bloodied” Ayodhya were now remembering the city. He also criticised political leaders over their conduct at religious gatherings, referring to the decorum of a katha.

Akhilesh has not yet visited the Ram Temple

Akhilesh Yadav has visited Ayodhya earlier but has not so far visited the Ram Temple. The SP leader was in the city on October 8 to attend a Bhagwat Katha organised by party leader Pawan Pandey.

According to the report, Akhilesh and his wife, Mainpuri MP Dimple Yadav, are scheduled to offer prayers at the Ram Temple and Hanumangarhi on December 12.

The planned visit comes amid political activity in Ayodhya ahead of the Uttar Pradesh Assembly elections due by February 2027.

Yogi highlights Ayodhya’s transformation

During his Deepotsav address, Yogi also spoke about the changes in Ayodhya and described the city’s transformation as an ideological victory.

He said those who had previously neglected Ayodhya were now witnessing its development. He also said Lord Ram represented India’s national consciousness, culture, values and self-respect.

The chief minister further recalled the Ram Janmabhoomi movement and said Ayodhya had regained the glory for which kar sevaks and saints had struggled.

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Ahead of Diwali, Yogi govt hikes DA by 5% for UP government staff

The Uttar Pradesh government has increased Dearness Allowance by 5 percentage points, taking it from 58% to 63%. The revised rate will benefit lakhs of eligible employees ahead of Diwali.

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Yogi Adityanath

The Uttar Pradesh government has announced a 5 per cent increase in Dearness Allowance (DA) for state government employees ahead of Diwali. With this revision, the DA rate has increased from 58 per cent to 63 per cent, providing financial relief to lakhs of eligible employees across the state.

The revised allowance will be effective from July 1, 2026, according to the government announcement. A government order was also issued on Saturday, November 7.

The enhanced DA will be paid along with employees’ regular November 2026 salaries.

Which employees will benefit from the DA hike?

The decision covers regular state government employees and several other categories of eligible staff.

These include employees of aided educational and technical institutions, regular and full-time employees of urban local bodies, work-charged employees and personnel drawing salaries under University Grants Commission (UGC) pay scales.

The revision is expected to benefit a large section of the Uttar Pradesh workforce ahead of the festive season.

What happens to the DA arrears?

The revised DA rate will apply retrospectively from July 1, 2026. Consequently, employees will also be entitled to arrears for the period preceding the November salary payment.

The government has made provisions for the payment of the arrears for July to October 2026. These amounts will be credited to employees’ provident fund accounts, according to the reported payment arrangements.

The enhanced allowance for November will be reflected in the regular salary for that month.

The decision comes ahead of Diwali and will provide additional financial relief to eligible government employees in Uttar Pradesh.

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Himanta Sarma to approach court over threat to gherao home in Zubeen case

Assam Chief Minister Himanta Biswa Sarma said his government would approach the Supreme Court and Gauhati High Court over a threat to gherao his residence if two prime accused in the Zubeen Garg death case are granted bail.

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Assam Chief Minister Himanta Biswa Sarma on Friday said the state government would bring before the Supreme Court and Gauhati High Court a threat by a group to gherao his residence in connection with the Zubeen Garg death case.

Speaking to reporters, Sarma described the threat as a serious matter, saying it posed a danger to his family and could amount to a direct attempt to murder.

The development comes ahead of the Supreme Court hearing on November 30 of the bail petitions filed by Shyamkanu Mahanta and Siddhartha Sharma, the two prime accused in the case.

Why Himanta Sarma plans to approach the courts

Sarma said he had instructed the state government’s legal department to bring the matter to the notice of both the Supreme Court and Gauhati High Court.

The Chief Minister objected to the group threatening to target his residence rather than holding a protest near the Chief Minister’s Office.

He said those questioning the judicial process should approach the Supreme Court or the high court instead of targeting him. Sarma also maintained that the courts should be allowed to carry out their work.

According to him, attempts to question the judicial process in this manner could obstruct the path of justice.

What the group said about the bail pleas

The Zubeen Garg Nyay Samiti, led by Raijor Dal MLA Akhil Gogoi, had announced on Thursday that it would gherao the Chief Minister’s residence under certain circumstances.

The group said it would carry out the protest if Shyamkanu Mahanta and Siddhartha Sharma were granted bail or if the Assam government failed to mount an effective legal opposition to their bail pleas.

The Supreme Court is scheduled to hear the bail petitions of the two accused on November 30.

Bail granted to two accused in the case

The Gauhati High Court granted bail to singer Amritprava Mahanta, an accused in the Zubeen Garg death case, on October 9. She was granted bail against a bond of Rs 50,000 and two sureties of the same amount.

The high court has also granted bail to Sandipan Garg in the case.

Referring to the bail order concerning Amritprava Mahanta, Sarma said it mentioned that 160 witnesses had not named her during the court hearing, despite having done so during the investigation conducted by the Special Investigation Team (SIT).

Responding to questions over the development, Sarma said the witnesses should be questioned about the discrepancy rather than him.

What happened to Zubeen Garg?

Singer Zubeen Garg died in Singapore on September 19 last year while swimming in the sea.

Police in Singapore had said that no foul play was involved in his death. Garg had travelled to Singapore to attend the fourth edition of the North East India Festival (NEIF).

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