RBI cuts repo rate by 25 basis points, second time in less than two months Wednesday March 04,2015

 

RBI on Wednesday March 04,2015 slashed key policy (repo) rate by 0.25 % to 7.5 %, the second such surprise rate cut outside regular policy review in less than two months. It has been decided to reduce the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 7.75 % to 7.5 % with immediate effect, RBI Governor Raghuram Rajan said in a statement.

The cut in the policy rate by RBI will help in lowering interest rate for individual and corporate borrowers. It will thus make home, auto and corporate loans cheaper.

However, cash reserve ratio (percentage of deposits kept in government securities) has been left unchanged at 4 %

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