With inflation remaining double digits for consecutive six weeks, RBI plans to tighten its monetary policy. The policy has a direct impact on the interest rates. Oops! Another setback for the car manufacturers.
Car manufacturers are now really frightened with the continuous increase in fuel prices as well as the interest rates. Now all the heart goes down.
Are car manufacturers still strong and powerful to face this obstacle and win over the challenge? The Indian car industry is going down with low economic gains.
This is the third time in the calendar year 2008 and the second time in the current month that the interest rates have climbed up. The current repo rate, rate at which Central Government lends money to the banks, has been increased by half a percentage point and the cash reserve ratio, cash that bank puts aside, has been increased by 0.25 percentage point.
A car loan amount of Rs 3 lakh for a period of three years will have a higher EMI of Rs 73. Car loan for a period of five years, will have an EMI of extra Rs 79 and the loan taken for 7 years will have an additional amount of Rs 84 in the EMI.
The things are becoming worse day by day. When will this inflation end? Who will bring an end? What and when is the next hike in interest rates? Who knows?