HOW WILL THE HIKE IN REPO RATE AFFECT THE INDIAN STOCK MARKET?
What exactly is the 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 (Source: Economic Times). During times of inflation, the RBI increases Repo Rate so as to decrease the purchasing power of the people and reduce the money supply in the market, thererby controlling inflation.
The Reserve Bank of India in its monetary policy meeting held on 7th December, 2022 has hiked the repo rate by 0.35 %. The repo rate now will be 6.25%. This will effectively mean that purchasing power of the people will go down, leaving little funds for investment or trading in the stock market/ equity market.
However, there is no need to panic. The previous revision in the Repo rate was on September 30, 2022 where it was 5.90% (raised by 0.50% since previous rate). After this, the Nifty touched 18,800 points during last week of November, 2022. Also, if you trade under proper guidance and expertise, you can utilise this opportunity of earning from the Stock Market/ equity market. As this month of December, 2022 progresses, the highly qualified and experienced, certified staff of Stakeindia is of the opinion that we can expect good movement in the Stock Market as the year ends and make our New year 2023 indeed very happy. To understand the analysis, predictions and methodologies of Stakeindia (the oldest Stock Market/ Share Market Training Institute in Nashik, Maharashtra), get in touch with us at stakeindiainstitute@gmail.com
