Second unscheduled policy review sees cut in repo rate by 25 points, banks may review their rates
GN Bureau | March 4, 2015
The Reserve Bank of India (RBI) again surprised the nation by holding an unscheduled monetary policy review on Wednesday and reduced the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points (bps) from 7.75% to 7.5% with immediate effect. As a result, the reverse repo rate under the LAF stands adjusted to 6.5%, and the marginal standing facility (MSF) rate and the bank rate at 8.5% with immediate effect.
The cut in the policy rate by RBI will help in lowering interest rates and make home, auto and corporate loans cheaper. Country's largest lender State Bank of India welcomed the second surprise rate cut and promised to take an "appropriate call" on its lending rates. "We welcome the repo rate cut by RBI... Our bank will take an appropriate call of a cut in base rate by looking at all evolving circumstances," SBI chairperson Arundhati Bhattacharya said in a statement.
Meanwhile, key indices jumped in early trade after the monetary policy review with the S&P BSE sensex crossing the 30,000 level for the first time in its history. Nifty moved past psychological 9,000 level. The index gained 431.01 points at the day's high of 30,024.74 in early trade, a record high. By noon the sensex settle around 29,890. This was the first time that the bank has announced a monetary policy action ahead of markets opening.
On the policy front the RBI said that the guidance on policy action given in the fifth-bi-monthly monetary policy statement of December 2014 is largely unchanged. Further monetary actions will be conditioned by incoming data, especially on the easing of supply constraints, improved availability of key inputs such as power, land, minerals and infrastructure, continuing progress on high-quality fiscal consolidation, the pass through of past rate cuts into lending rates, the monsoon outturn and developments in the international environment, RBI said.
This unscheduled review (second in last few months) was prompted by two factors: first, while the next bi-monthly policy statement will be issued on April 7, 2015, the still weak state of certain sectors of the economy as well as the global trend towards easing suggests that any policy action should be anticipatory once sufficient data support the policy stance. Second, with the release of the agreement on the monetary policy framework, it is appropriate for the Reserve Bank to offer guidance on how it will implement the mandate, RBI said.
Since August 2019, Government of India, in partnership with States, is implementing Jal Jeevan Mission (JJM) to make provision of potable tap water supply every rural household by 2024. As many as 6.70 crore households have been provided with tap water connections in the 35 months, since Aug
Over the last few years, cloud has been able to create a special place for itself amongst fast moving, competitive and growth-led organisations. As the technology became an imperative, it has undoubtedly created unique business opportunities and isbecoming an anchor for innovation for leading businesses gl
None-of-the-above, or NOTA – the option introduced for voters in 2013 when they don’t want to support any of the candidate – has made some progress. In the past five years, NOTA has secured 1,29,77,627 votes in state assembly elections and Lok Sabha election, according to an analysis by t
India stands committed to reduce Emissions Intensity of its GDP by 45 percent from the 2005 level by 2030 and achieve about 50 percent cumulative electric power installed capacity from non-fossil fuel-based energy resources by 2030. The country’s India’s updated Nationally Determined Contributi
The government had put 72,098 MHz spectrum to auction, of which 51,236 MHz (71% of the total) has been sold with bid amounting to Rs. 1,50,173 crore. Adani Data Networks Ltd has obtained 400 MHz spectrum in mm wave band (26 GHz). Bharti Airtel Ltd has obtained 19,867.8 MHz in 900, 1800, 2100
A steep rise has been recorded over the past three years in pre-monsoon surface air temperature, land surface temperature and relative humidity in Delhi/NCR, whereas there is no such increase in relative humidity. This is a cause of concern, Dr Jitendra Singh, minister of state (independent