Reserve Bank of India (RBI) has reduced its lending rate by 0.25 per cent to 6.25 per cent with the monetary policy committee voted 4:2 in the favour of a rate cut. The RBI has also changed its stance to “neutral” from existing “calibrated tightening”. The ‘repo rate is a key interest rate at which the Central Bank lends short-term funds to commercial banks.
RBI has received a proposal for an umbrella organisation for urban cooperative banks. RBI has decided on this positively. A decision on the specifics of the umbrella organisation proposal will be taken shortly, reported news agency.
According to Indian Express reports, the reverse repo rate under the LAF now stands adjusted to 6.0 per cent and the marginal standing facility (MSF) rate and the Bank Rate to 6.5 per cent.V
RBI has recieved a proposal for an umbrella organisation for urban cooperative banks. RBI has decided on this positively. A decision on the specifics of the umbrella organisation proposal will be taken shortly.4
The GDP projection for 2019-20 is 7.4 %. The inflation rate is estimated at 3.2-3.4% in the first half of the year 2019-20 and 3.9 % in the third quarter of 2019-20, said RBI Governor Shaktikanta Das.
“Headline inflation is expected to remain contained below or at its target of 4%. This has opened space for policy action. Investment activity is recovering supported mainly by public spending on infrastructure,” RBI Governor said.
Export growth on a year-on-year basis was almost flat in November and December 2018, primarily due to a high base effect and weak global demand.
RBI has decided enhancement of collateral free agriculture loan from Rs 1 lakh to Rs 1.6 lakhs. This enhancement Rs 60,000 has been taken in view of the overall rise in inflation, marginal agriculture input and benefit to small farmers.
RBI Governor Shaktikanta Das said, “we are constantly & continuously monitoring the liquidity situation and based on the requirement we will ensure that there is no liquidity scarcity.”
Agencies
