RBI cuts down CRR by 25 basis points
TNI Bureau: The Reserve Bank of India (RBI) cut the cash reserve ratio (CRR) by 25 basis points for banks a day after Union Finance Minister P Chidambaram unveiled fiscal consolidation plan to promote investments and reduce inflation. However, the repo rate remained unchanged at 8.00 per cent.
In a quarterly policy review, RBI Governor Duvvuri Subbarao wrote, “As inflation eases further, there will be an opportunity for monetary policy to act in conjunction with fiscal and other measures to mitigate the growth risks and take the economy to a sustained higher growth trajectory”.
The RBI’s move on Tuesday indicated that the India’s monetary policy would be eased in the fourth quarter (January-March) of 2012-13.