Third Quarter Monetary Policy Review 28th Jan 2014
Mr. Raghuraman Rajan, Governer of Reserve Bank of India surprised the Banking circle with
Increase in the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 7.75 per cent to 8.0 per cent; and consequently, the reverse repo rate under the LAF stands adjusted at 7.0 per cent, and the marginal standing facility (MSF) rate and the Bank Rate at 9.0 per cent.
But the cash reserve ratio (CRR) of scheduled bankskept unchanged at 4.0 per cent of net demand and time liability (NDTL).
The banking circle and the market was expecting the RBI Governer would keep the rates unchanged.
Following the recommendation of the Dr. Urjit Patel Committee, monetary policy reviews will ordinarily be undertaken in a two-monthly cycle, consistent with the availability of key macroeconomic and financial data. Accordingly, the next policy review is scheduled on Tuesday, April 1, 2014.
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