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7
December 2016
Backing the Monetary Policy Committee
(MPC) decision to keep the key lending rate unchanged at 6.25%, RBI Governor
Urjit Patel on Wednesday said that a cut was not warranted at this juncture,
given the 5% inflation target to be achieved by March end. The Total Investment & Insurance
Solutions
"MPC was of the view that given the
25 bps cut in October and a total of 125 bps since January 2015, a further cut
was not warranted at this juncture," Patel said at the press conference
after the monetary policy was announced on the RBI website. The Total Investment & Insurance
Solutions
He said that the committee felt it was
important to achieve the 5% consumer price index inflation target by March
2017. The Total Investment &
Insurance Solutions
The Reserve Bank of India (RBI) on
Wednesday kept the repurchase rate, or the short-term lending rate charged by
the central bank on borrowings by commercial banks, unchanged at 6.25% in its
first policy review after demonetisation. The reverse repurchase rate also
automatically stands lowered to 5.75%.
The move came as a surprise as the
industry was expecting anywhere between 25-50 basis points (bps) cut as the
banks are flush with cash after the November 8 demonetisation move.The Total Investment & Insurance
Solutions
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