Economics · Monetary Policy
Which of the following statements is true regarding the 'Bank Rate' in India?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1It is an instrument applicable exclusively to cooperative credit societies
- 2It is always lower than the Policy Repo Rate
- 3It is aligned with the MSF rate and affects the long-term cost of capital/penal rates✓
- 4It is the short-term policy interest rate used for day-to-day liquidity management
Correct answer
It is aligned with the MSF rate and affects the long-term cost of capital/penal rates
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