RBI Comes up with Rescue Package, Pumps in Rs 1.37 Lakh Cr into Economy
RBI Cuts Repo Rate to 4.4% and CRR to 3%, 3-month Moratorium on Loans.
New Delhi: A day after Finance Minister announced package for poor, Reserve Bank of India Governor Shaktikanta Das today announced a cut in the repo rate by 75 basis points and that in reverse repo rate by 90 basis points to help the economy tide over the coronavirus distress.
Das also announced that banks and NBFCs can allow a 3-month moratorium on loans.
MPC (Monetary Policy Committee) noted that global economic activity has come to a near stand-still as Covid-19 related lockdowns & social distancing in affected countries. Expectations of a shallow recovery in 2020 from 2019’s decade low in global growth have been dashed,” he added.
World May Slip Into Recession: “There was a rising probability that large parts of the world economy could slip into a recession. Tough times were ahead but they don’t last, only tough institutions do,” says RBI Governor Shaktikanta Das.
Repo rate cut to 4 Percent, Reverse Repo-Rate Reduced by 90 basic points:
“The RBI today cut LAF by 90 basic points to 4 percent. The Reverse repo-rate has been reduced by 90 basis points to 4 per cent. India has locked down economic activity. Keeping finance flowing is the paramount objective of the RBI, while India has locker down economic activity and financial activity is under severe stress,” says RBI Governor Shaktikanta Das.
RBI Decides to Reduce Cash Reserve Ratio of All Banks
“It has been decided to reduce the Cash Reserve Ratio (CRR) of all banks by 100 basis points to 3 per cent of Net Demand and Time Liabilities with effect from the fortnight beginning March 28 for a period of 1 year. The measures will result in total liquidity injection of Rs 3.74 lakh crore to the system,” says RBI Governor Shaktikanta Das.
All Commercial Banks, NBFC Permitted to Allow 3-Month Moratorium on Loans | RBI Governor Shaktikanta Das today announced, “All commercial banks and NBFC, are permitted to allow a three-month moratorium on payment of installments of all term loans.”