RBI cuts repo rate and reverse repo rate by 25 basis points each

RBI cuts repo rate by 25 basis points
Excerpts from the Monetary Policy Statement of August 2, 2017:
"On the state of the economy, the MPC is of the view that there is an urgent need to reinvigorate private investment, remove infrastructure bottlenecks and provide a major thrust to the Pradhan Mantri Awas Yojana for housing needs of all. This hinges on speedier clearance of projects by the States. On their part, the Government and the Reserve Bank are working in close coordination to resolve large stressed corporate borrowers and recapitalise public sector banks within the fiscal deficit target. These efforts should help restart credit flows to the productive sectors as demand revives."

While four members of MPC supported the rate cut announced, one member was for a rate cut of 50 basis points and the sixth member wanted status quo.
Also see Blog Post captioned "Goldilocks Problem: Usha Thorat"
M G Warrier


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