RBI increases repo rate by 25 bps to 6.5%; retains 'neutral' stance

The yields on the 10-year bond closed at 7.7%, lower than its previous close of 7.8%

The Reserve Bank of India (RBI) on Wednesday hiked policy rates for the second time in a row on fears of rising inflation rates, and cautioned that India needed to “run a tight ship” to avoid getting affected by the currency war that had started all over the world.

Economists now expect the central bank to go in for a prolonged pause and wait to see the impact of the globally evolving scenario.

Following the rate hike, which was anticipated by many in the market, the policy repo rate stands at 6.50 per cent. The policy stance continued to remain