Reserve Bank of India (RBI) has today (June 6, 2019) announced its second Bi-Monthly Monetary Policy Rates for 2019-20. The Monitory Policy Committee (MPC) of Reserve Bank of India decided to reduce the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points to 5.75 per cent from 6.0 per cent with immediate effect.
The revised key policy rates are as under.
|CRR (Cash Reserve Ratio)||4.00%|
|SLR (Statutory Liquidity Ratio)Effective from01.06.2019||18.75 %*|
|Reverse Repo Rate||5.50%|
|MSF Rate (Marginal Standing Facility Rate)||6.00%|
* RBI has decided to reduce statutory liquidity ratio, the portion of funds which banks are required to park in treasury bills and other instruments, by 0.25% every quarter beginning January. The calibrated reduction in statutory liquidity ratio (SLR) will continue till it reaches18%.The first reduction of 25 basis points taken effect in the quarter commencing January 2019.*
The MPC also decided to change the stance of monetary policy from neutral to accommodative. The MPC members Dr. Chetan Ghate, Dr. Pami Dua, Dr.Ravindra H. Dholakia, Dr. Michael Debabrata Patra, Dr. Viral V. Acharya and Shri Shaktikanta Das unanimously decided to reduce the policy repo rate by 25 basis and change the stance of monetary policy from neutral to accommodative.