RBI reduces reverse repo rate by 25 basis points from 4 pc to 3.75 pc

The Reserve Bank of India (RBI) today reduced the reverse repo rate by 25 basis points from four per cent to 3.75 per cent in a bid to inject liquidity in financial markets. However, the repo rate remains unchanged.

The Reserve Bank of India (RBI) today reduced the reverse repo rate by 25 basis points from four per cent to 3.75 per cent in a bid to inject liquidity in financial markets. However, the repo rate remains unchanged. This comes amid the COVID-19 pandemic and the subsequent countrywide lockdown.

RBI Governor Shaktikanta Das said the liquidity injection has been 3.2 per cent of GDP since February 6 to March 27. "The RBI has been taking pro-active measures and monitoring the situation closely. The contraction in exports at 34.6 per cent has been much worse than 2008-09 global financial crisis," Das said.

He said that India is expected to post a "sharp turnaround" by growing at 7.4 per cent in 2020-21. "For 2020-21, International Monetary Fund projects sizable reshaped recoveries, close to 9 percentage points for the global GDP. India is expected to post a sharp turnaround and resume its pre-COVID, pre-slowdown trajectory by growing at 7.4 per cent in 2020-21," the RBI Governor said. (ANI)