<br/>The Reserve Bank of India, in its Monetary Policy review, has hiked the Cash Reserve Ratio (CRR) by 75 basis points (bps) to 5.75 per cent. In the Third Quarter Review of Monetary Policy 2009-10 today in Mumbai, the central bank decided to keep the repo rate and reverse repo rate unchanged. The CRR hike will be done in two tranches. The first one will be for 50 bps with effect from February 13, 2010, and the balance 25 bps will be effective from February 27, 2010. Eventually, this will drain out 36,000 crore rupees from the system. Increases in CRR could push bond yields up, and weigh on shares of banks as well as sectors such as auto and property on concerns loan demand may slow. RBI kept the reverse repo rate unchanged at 3.25 per cent and repo rate at 4.75 per cent. Repo rate is the rate at which the banks can borrow money from RBI in order to avoid scarcity of funds. The move comes on the back of spiraling inflation. Food inflation touched 17.4 per cent for the week ended 16 January 2010, slightly higher than previous week's 16.81 per cent. Fuel price index rose to 5.7 per cent while primary articles price index touched 14.66 per cent for the week ended 16 January 2010. This policy is the first major move to mark the reversal of the easy money policy adopted since October 2008. The central bank projected the GDP growth for financial year 2009-10 at 7.5 per cent from 6 per cent last year. It also said that the inflation would be around 8.5 per cent in March. Announcing the third quarter review, RBI Governor D Subbarao told the Bankers that reduction of excess liquidity to the tune of Rs 36, 000 crore would help anchor inflationary expectations. The RBI would support the recovery process with out compromising price stability.<br/>