Within a day of RBI's status-quo policy, private sector Rana Kapoor-led Yes Bank today raised lending and fixed deposit (FD) rates by up to 0.5 per cent.
Yes Bank revised upwards its base rate by 0.25 per cent 10.75 per cent effective August 1, Yes Bank said in a statement. The Yes Bank also revised its fixed deposit rates by 0.25 per cent to 0.5 per cent in select tenors, it said.
The bank was the first to raise lending rate after RBI kept key policy rates unchanged.
Soon after RBI unveiled its first quarter review of monetary policy, many bankers had said that they may have no choice but to hike rates after a month to the detriment of retail borrowers and industry.
Weighed down by a weak rupee, the Reserve Bank of India today chose to keep the repo rate or the rate at which RBI lends to the system, has been retained at 7.25 per cent and the cash reserve ratio, the amount of deposits banks park with RBI, has been kept unchanged at 4 per cent.
In order to contain rupee depreciation, RBI has taken slew of measures in the past couple of weeks resulting in the tight liquidity situation for the banks.
The decline of the rupee to a record low of 61.21 against the dollar on July 8 forced the RBI to take a series of unconventional measures to curtail liquidity and curb speculation.
On July 15, the Reserve Bank put in place measures to restore stability in the foreign exchange market, including raising the Marginal Standing Facility and bank rates to 10.25 per cent and restricting access by way of repo window to Rs 75,000 crore.
The central bank also conducted open market sales of government securities of Rs 2,500 crore on