After nine months of waiting for a repo rate cuts, industry and stock markets finally had reason to cheer as the The Reserve Bank of India today cut the repo rate by 25 basis points and the cash reserve ratio by 25 basis points in its monetary policy review.
The move would help pull down interest rates in the economy, thus boosting credit and economic growth.
The CRR rate will help infuse Rs 18,000 crores into the banking system.
“Financing current account gap with capital flows is risky,” RBI governor D Subbarao stated. He further stated that the policy environment will be provided to help growth.