HDFC Bank Ltd. increased fixed deposit rates on various maturities by up to 0.6 percent, days after the Reserve Bank of India hiked the benchmark repo rate.
The revised rates of interest are with effect from today, as per the information posted on the bank's website. The increase in fixed deposit rates is likely to put pressure on lending rate as well.
The bank has raised interest rate on term deposit with maturity ranging between 6 months to five years. The deposit of maturity six to nine months would earn 6.75 percent, 40 basis points higher than previous rate.
Interest rate on fixed deposit of tenure longer than nine months to less than one year has been raised by 60 basis points, while for one year it has been increased by 40 basis points to 7.25 percent. However, fixed deposit beyond two years to five years will earn 10 basis points higher rate than the earlier interest rate.
The RBI increased the benchmark short-term lending rate, at which it lends to other banks, by 0.25 percent to 6.5 percent on inflationary concerns last week. The retail inflation, which is factored in by the central bank's Monetary Policy Committee, spiked to a five-month high of 5 percent in June on rising fuel prices.
The government has mandated RBI to keep inflation at 4 percent (+/- 2 percent).
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