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WHAT DO U MEAN BY REPO RATE???
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Answer Posted / arun
Repo Rate is called as the Repurchase Agreement Rate.
RBI holds some Govt Securites. Now when it feels that there
is too much liquidity in the market, RBI wants to suck
money from the Economy ( Market)
At such times it will SELL the Govt Securities to
Commercial Banks. The rate at which it sells the securites
is called REPO-RATE.
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