Reserve Bank of India on Tuesday cut the repo rate by 0.25 percent to 6.25 percent, lowest in last six years. In first monetary policy by new Governor Urjit Patel, RBI adjusted the reverse repo rate under LAF to 5.75 %.
The economist and financial pundits had strongly anticipated interest rate cuts as a favourable monetary policy tool to curb retail inflation and the MPC has lived up to its expectation in announcing rational rate cuts. As a result, within a minute of announcemnet Sensex registered a gain of 100 points.
Specuations regarding a divergent among members of the committee were put to rest as all the six members of Monetary Policy Committee voting in favor of rate cut.
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#Reverse repo rate under the LAF stands adjusted to 5.75 %, and the marginal standing facility (MSF) rate and the Bank Rate to 6.75 %: RBI
#All six members of Monetary Policy Committee voted in favour of rate cut
#RBI policy effect: Sensex rises more than 100 points at 2.31 p.m.
#RBI cuts repo rate by 0.25 percent to 6.25 percent