The country's largest private sector lender HDFC Bank on Tuesday announced a 0.35 per cent hike in lending rate.

The hike, which comes a day ahead of the RBI's scheduled policy review, is the second such move from the lender in as many months, taking the cumulative hike to up to 0.60 per cent.

The RBI had surprised all with a 0.40 per cent hike in key interest rates on May 4 to tame the inflation situation and is widely expected to follow up with further tightening of the policy on Wednesday.

HDFC Bank increased its Marginal Cost of funding based Lending Rate by 0.35 per cent from June 7, as per the new rate structure published on its website.

The one-year MCLR, on which a bulk of consumer loans are pegged, will be 7.85 per cent after the newest review as against 7.50 per cent earlier.

The overnight MCLR will be 7.50 per cent against 7.15 per cent, while the three-year MCLR will be 8.05 per cent compared to 7.70 per cent.

It can be noted that the rate hikes come at a time when credit growth is not very high and banks are keen to accelerate on the same. There have been hikes in deposit rates as well, which have preceded the lending rate hikes, along with the change in the policy environment.