The Reserve Bank has raised its key short-term lending and borrowing rates by 25 basis points each. The repo and reverse rate or short-term rates at which RBI lends and borrows from banks were hiked to 5 per cent and 3.5 per cent respectively and could make banks commercial lending dearer. The Reserve Bank said, these measures should anchor inflationary expectations and contain inflation going forward. The announcement comes a month ahead of the announcement of RBI's annual monetary policy for the next fiscal.