The repo rate, also known as the repurchase rate, is a monetary policy tool used by the Reserve Bank of India. It is the interest rate charged by the RBI on loans to commercial banks. It determines the interest rate of the loans made by the commercial bank to the public, which in turn affects the money supply in the economy. The movement of the repo rate influences borrowing costs, and the money supply adjusts accordingly. 

The RBI changes the repo rate to achieve the inflation target, which is within the range of 4 +/- 2 percent. 

Recently, from June 5–7, the Monetary Policy Committee, consisting of six members, held a meeting to determine the repo rate. With a 4:2 vote, it was decided to hold the repo rate constant at 6.50%. As per the reports from the RBI, headline inflation was 4.8% in April, which is above the 4 percent target. Besides, as outlined in the report, the risk of food price inflation affecting core inflation needs to be monitored. Thus, in light of this fact and wanting to bring the inflation rate down to the target of 4 percent, it was promptly decided to keep the repo rate unchanged.