RBI cuts key rate by 35 bps to boost economic activity, lowest since April 2010
RBI cuts key rate by 35 bps to boost economic activity, lowest since April 2010
NEW DELHI: The Reserve Bank of India (RBI) on Wednesday cut key interest rate for the fourth consecutive time, as it reduces repo rate by 35 basis points to 5.40 per cent to boost the slowing economy.nnThe repo rate is lowest since April 2010.nn
Governor @DasShaktikanta addressing third bi-monthly monetary policy press conference #rbitoday #rbigovernor #monetarypolicy pic.twitter.com/3eUhcVPscI
— ReserveBankOfIndia (@RBI) August 7, 2019
nnThe six-member monetary policy committee (MPC) also maintained the accommodative stance on the monetary policy.nnNoting that inflation is currently projected to remain within the target over a 12-month ahead horizon, the MPC said since the last (June) policy, domestic economic activity continues to be weak, with the global slowdown and escalating trade tensions posing downside risks.nnIt said that even as the past rate cuts are being gradually transmitted to the real economy, the benign inflation outlook provides headroom for policy action to close the negative output gap.nnThis is the fourth consecutive time that the RBI has reduced repo rate. In the earlier three policies, it has reduced repo rate by 25 basis points each.nnThe RBI also revised real GDP growth for 2019-20 downwards to 6.9 per cent from 7 per cent in the June policy.nnCPI inflation is projected at 3.1 per cent for the second quarter of FY20 and 3.5-3.7 per cent for second half of FY20, with risks evenly balanced.nnSource: Press Trust of India
