The Reserve Bank of India (RBI) surprised the markets as RBI governor Raghuram Rajan cuts repo rate by 50 basis points from 7.25 per cent to 6.75 per cent.
In 2015, this is the fourth such cut by the central bank and total of 1.25 per cent cut this year.
Here are highlights of the RBI monetary policy
1. The RBI kept the current reverse repo rate and the Cash Reserve Ratio or CRR unchanged.
2. RBI says inflation is expected to reach 5.8 per cent in January 2016.
3. Limit for FPI investment in govt bonds to be increased in phases to 5 per cent of outstanding stock by March 2018.
4. The RBI cut the GDP forecast to 7.4 per cent for the current fiscal from 7.6 per cent.
5. The RBI has permitted Indian corporates to issue rupee denominated bonds with a minimum maturity of five years at overseas locations within the ceiling of foreign investment permitted in corporate debt.
6. RBI said that it will issue final guidelines on base rate computation by November-end.