What do you mean by reverse repo rate ?

1.	What do you mean by reverse repo rate ?
Answer» It is the rate at which the central bank of a country (Reserve Bank of India, in case of India) borrows money from the commercial banks within the country. It is the monetary policy instrument which can be used to control the money supply in the country. When this rate is increased, banks increase their savings in the central bank, which makes their loan-giving ability weaker. And if this rate is decreased, than banks decrease their savings from the central bank which increases their ability of giving loans. At present, this rate is 5.75%.

Discussion