Starting the rate – cut cycle after six months pause, the Reserve Bank of India slashed key lending rate by 25 basis points on Tuesday.
The apex bank cut the repo rate, it is rate at which commercial bank borrow from it, by 25 bps to 6.5 percent. While on the other hand, it has maintained the CRR at 4 percent.
The bank has also reduced the marginal standing facility rate by 75 basis to 7 percent. Notably, the move fell short of the market’s expectation of a 50 basis points rate cut.
The bank has forecast the economy to grow at 7.6 percent in gross value added terms FY17. The policy review is more focused on liquidity.
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