0 abbreviation for repurchase rate: the interest rate for bonds, shares, etc. that are bought back under a repurchase agreement:
A reduction in the repo rate will help banks to get money at a cheaper rate.
The repurchase price should be greater than the original sale price, the difference effectively representing interest, sometimes called the "repo rate".
This is the reason it is called repo rate.
Repo rate has become the key policy rate which signals the monetary policy stance of the economy.
The reverse repo rate will be 100 basis points below repo rate.
The liquidity adjustment facility corridor, that is the excess of repo rate over reverse repo, has varied between 100 to 300 basis points.
When the repo rate increases, borrowing from the central bank becomes more expensive.
The borrowing is commonly done via repos, where the repo rate is the rate at which the central bank lends short-term money to the banks against securities.
