RBI cuts repo rate by 40 bps to 4 pc to increase credit flow

Published: May 22, 2020, 10:44 IST | ANI | Mumbai

The six-member monetary policy committee (MPC) voted 5:1 in favour of the decision

Shaktikanta Das. Picture courtesy/ ANI Twitter
Shaktikanta Das. Picture courtesy/ ANI Twitter

The Reserve Bank of India (RBI) on Friday reduced repo rate by 40 basis points to 4 per cent in an effort to further boost liquidity in the economy which has been reeling under the impact of COVID-19 induced countrywide lockdown.

As a result, the reverse repo rate stands at 3.35 per cent, said RBI Governor Shaktikanta Das. The six-member monetary policy committee (MPC) voted 5:1 in favour of the decision.

Repo rate is the rate at which a country's central bank lends money to commercial banks, and the reverse repo rate is the rate at which it borrows from them.

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