RBI Keeps All Key Rates Unchanged

07 April, Mumbai

As widely expected by the markets, the Reserve Bank of India has kept all the key rates unchanged. Thus the repo rate stands at 7.50 percent and the cash reserve ratio stands at 4 percent.

RBI Governor made the announcement at the first bi-monthly monetary policy review for 2015-16 in Mumbai Tuesday .

Repo rate is the rate at which RBI lends to banks, while Cash Reserve Ratio – CRR is a certain percentage of bank deposits which banks are required to keep with RBI in the form of reserves or balances.

Consequently, the reverse repo rate under the LAF will remain unchanged at 6.50 per cent, and the marginal standing facility (MSF) rate and the Bank Rate at 8.50 per cent. RBI has also kept the statutory liquidity ratio (SLR) of scheduled commercial banks unchanged on 21.5 per cent.

RBI Governor Raghuram Rajan has said that he will wait for the change to happen as the rate cuts were already announced.

The CPI inflation is projected to be at its current level in the first quarter of the fiscal 2015-16 and moderating thereafter to about 4 percent by August but firming up to reach at 5.8 percent by the end of this year.

According to Raghuram Rajan, the economy is showing steady progress and the GDP projection is 7.8 percent in the current fiscal up from 7.5 percent in 2014-15.