Repurchase rate, also known as the reverse repo rate, is the interest rate at which a central bank lends money to commercial banks in exchange for government securities. This rate is used as a tool by central banks to control the money supply in the economy and influence short-term interest rates. A higher repurchase rate encourages banks to borrow less and lend more, thus reducing the amount of money in circulation. Conversely, a lower repurchase rate encourages banks to borrow more and lend less, increasing the money supply. This rate is an important indicator of the overall health of an economy and is closely monitored by financial institutions and investors.