LIC Housing Finance increased its Prime Lending Rate by 50 basis points on Monday. With this the new interest rates on home loans will now start from 8 per cent as against 7.50 per cent earlier.

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The new rates will be effective from Monday.

The move was inline with the central bank, which hiked repo rate by 50 basis points in the recent monetary policy to tame inflation that is hovering above the upper tolerance band for consecutive months.

"As expected, the RBI's decision to hike the repo rate by 50 basis points on 5th August was well measured and abreast with the global economic trend. The hike in repo rate has caused some minimum fluctuation in the EMIs or the tenure on the home loans but demand for housing will remain robust. Hence, the interest rate hike of LIC HFL is in line with the market scenario," said Y. Viswanatha Gowd, MD & CEO.