Banks are set to increase lending rates by another half a percentage point, after the Reserve Bank sharply raised key policy rates. The RBI yesterday hiked short-term lending and borrowing rates by 50 basis points to tame high inflation. With this increase, the short-term lending or Repo Rate has been hiked to 8 per cent and the short-term borrowing or Reverse Repo rate has been increased to 7 per cent. We spoke to Market watcher DK Joshi about the latest RBI move:The EMI for home loan of a 20-year tenure will go up to 1,066 rupees from 1,032 rupees per lakh at present as banks are set to revise their lending rates.Acording to estimates by experts, for a three-year auto loan, the EMI will increase from 3,289 rupees to 3,311 rupees per lakh.The Country's largest lender State Bank of India's Chairman Pratip Chaudhuri said, the rising input cost will be passed on to the customerThe move is expected to make all personal and corporate loans more expensive. The RBI has also revised its fiscal-end inflation projection to 7 per cent from 6 per cent earlier. The Country's biggest private sector lender ICICI Bank's CEO and Managing Director Chanda Kochhar said, banks will review the movement in funding costs and effect further increases in lending rates. Private sector Yes Bank has already announced an upward revision in the lending rates by 50 basis points.