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Here’s all you need to know about RBI Monetary Policy

06 Aug 2020

The Reserve Bank of India (RBI) announced that the repo rate and reverse repo rates will remain unchanged at 4% and 3.35% respectively as per the new Monetary Policy. Governor Shaktikanta Das also mentioned that that the inflation is likely to increase in the second quarter and that an accommodative stance of the monetary policy will continue till the time it is required to revive growth and mitigate the impact of the pandemic. He further added that the RBI aims at ensuring that inflation remains within target going forward.

Some of the other key points included the central bank's decision to allow lenders to restructure corporate and MSME loans. It has also raised the limit of loans that can be availed against gold ornaments and jewellery. Further, the bank aims at providing additional liquidity facility of ₹10,000 crore to National Bank for Agriculture and Rural Development (Nabard) and National Housing Bank (NHB). To increase the liquidity in the Debt Mutual Funds and ETFs, the central bank has reduced the risk capital that the banks had to set aside against the investment in the two. There is also a mechanism of Positive Pay for all cheques of value Rs 50,000 and above being introduced by RBI. It aims at increasing the customer safety by keeping a check on the fraudulent activities and is expected to cover above 20% of the cheques issued in the country by volume and about 80% by value. The real GDP growth is anticipated to remain negative for 2021.

Click here for the detailed announcement by RBI on the new monetary policy.

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Here’s all you need to know about RBI Monetary Policy

06 Aug 2020

The Reserve Bank of India (RBI) announced that the repo rate and reverse repo rates will remain unchanged at 4% and 3.35% respectively as per the new Monetary Policy. Governor Shaktikanta Das also mentioned that that the inflation is likely to increase in the second quarter and that an accommodative stance of the monetary policy will continue till the time it is required to revive growth and mitigate the impact of the pandemic. He further added that the RBI aims at ensuring that inflation remains within target going forward.

Some of the other key points included the central bank's decision to allow lenders to restructure corporate and MSME loans. It has also raised the limit of loans that can be availed against gold ornaments and jewellery. Further, the bank aims at providing additional liquidity facility of ₹10,000 crore to National Bank for Agriculture and Rural Development (Nabard) and National Housing Bank (NHB). To increase the liquidity in the Debt Mutual Funds and ETFs, the central bank has reduced the risk capital that the banks had to set aside against the investment in the two. There is also a mechanism of Positive Pay for all cheques of value Rs 50,000 and above being introduced by RBI. It aims at increasing the customer safety by keeping a check on the fraudulent activities and is expected to cover above 20% of the cheques issued in the country by volume and about 80% by value. The real GDP growth is anticipated to remain negative for 2021.

Click here for the detailed announcement by RBI on the new monetary policy.