CRR cut likely: RBI

Posted By: Religare
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CRR cut likely: RBI
Ahead of Reserve Bank of India (RBI) monetary policy scheduled to be tabled on March 15, Deputy Governor HR Khan said that chances of further cut in the cash reserve ratio (CRR) for banks is likely, but a view had not yet been taken.

When media asked if the RBI would consider a CRR cut between policy reviews, he said, "We are looking at all options, but a view has to be taken."

The option of debt buying through open market operations could not be ruled out, he added.

CRR is the amount of deposits that banks have to maintain with the central bank.

Last month in its monetary policy, RBI cut the CRR by 50 basis points, releasing around 320 billion rupees into the banking system.

However, central bank has left unchanged the REPO rate, the rate at which bank borrow from the RBI, indicating a large shortfall in liquidity.

Dion Global Solutions Ltd

Read more about: rbi, monetary policy, crr
Story first published: Monday, March 5, 2012, 9:31 [IST]
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