The RBI has surprised the market as well as bankers by going for a third policy rate hike this fiscal.

The banking regulator has raised both repo and reverse repo rates by by 25 basis points to 5.5% and 4%, respectively. Repo rate refers to the rate at which RBI lends money to banks and reverse repo refers to the rate at which banks park their excess funds with RBI.

This step by the apex bank is in line to control the towering inflation.

Bankers have however negated the immediate effect of this rate hike on lending rates.

"In terms of lending rate, I don't see any immediate impact, but there could be a slight rise in deposit rates, depending upon the liquidity conditions," said MD Mallya, chairman and managing director, Bank of Baroda.

"The hike was expected, but not so soon," said SS Ranjan, chief financial officer, State Bank of India. On whether this will trigger action on lending rates, Ranjan said "we will wait and watch before taking any cues from the rate hikes."