Less than a week after Indian GDP figures illustrated a reduced growth rate 5.3%, the Reserve Bank of India (RBI) has announced as predicted in our earlier post last week ,to lower the cost of lending deposit rates by trimming the repo rate and the reverse repo rate by 50 basis points each.

This is the rate at which the RBI lends to Indian banks and has been cut to 5 %. The reverse repo rate, or the rate at which the RBI absorbs liquidity, has been pared to 3.5 per cent. The move has been widely welcomed and it is hoped it will be passed on by the main Indian lenders in an effort to increase growth and restore strong GDP growth.

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Tags: Indian interest rates, RBI, Reserve Bank of India

This entry was posted on Friday, March 6th, 2009 and is filed under Indian interest rates. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.