Monday, January 24, 2011

RBI raises key rates by 25 basis points



The country’s central bank today announced its 'Third Quarter Review of Monetary Policy 2010-11' wherein it has hiked both the repo rate and the reverse repo rate by 25 basis points from 6.25 per cent to 6.5 per cent with immediate effect, signaling a tighter interest rate scenario ahead. Though the RBI has left the bank rate as well as the CRR unchanged at 6%.

The following are the highlights of the Monetary Measures announced by the apex bank:

Bank Rate: The Bank Rate has been retained at 6.0 per cent.

Repo Rate: Increases the repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 6.25 per cent to 6.5 per cent with immediate effect.

Reverse Repo Rate: Increases the reverse repo rate under the LAF by 25 basis points from 5.25 per cent to 5.50 per cent with immediate effect.

Cash Reserve Ratio: The cash reserve ratio (CRR) of scheduled banks has been retained at 6.0 per cent of their net demand and time liabilities (NDTL).









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