RBI cuts repo rate by 25 base points to 6 pc
The Reserve Bank of India Thursday cut repo rate by 25 base points to 6.00 percent. The reverse repo rate, meanwhile, fell to 5.75 percent. The bank retained "neutral" monetary policy stance and projected the GDP growth for 2019-20 at 7.2 per cent. The Reserve Bank of India also revised downward retail inflation estimate to 2.4 per cent in Q4 FY19, 2.9-3 per cent in H1 FY20 and 3.5-3.8 per cent in H2 FY20, mainly due to lower food and fuel prices as well as expectation of a normal rainy season.
Four out of six MPC members voted for rate cut, other two favoured no change in repo rate, the RBI said on Thursday.
Addressing the media following the RBI announcement, Governor Shaktikanta Das said, "Export growth remained weak in January and Feb 2019, while, imports specially non-oil gold imports declined."
"GDP projection for 2019-20 is kept at 7.2 per cent, 6.8 to 7.1 per cent for the first half of 2019-20 and 7.3 to 7.4 per cent for the second half," he said.
The RBI governor further said the bank will issue a revised circular for NPA resolution without much delay.
Earlier on February 7, the Reserve Bank of India cut repo rate by 25 basis points, which settled at 6.25 from 6.5 per cent, while the reverse repo rate stood at 6.00 per cent.
The GDP growth for 2019-20 was put at 7.4 per cent by the RBI. The inflation rate was estimated at 3.2-3.4 per cent in the first half of the year 2019-20 and 3.9 per cent in the third quarter of 2019-20.
Meanwhile, international crude oil prices have increased by around 10 per cent since the last policy announcement.
