line with market expectations, the Reserve bank of India (RBI), its first
bi-month Monetary Policy Committee meeting on Thursday, reduced key benchmark
policy rates by 25bps to 6.00%, in a 4-2 split vote on Thursday. The repo-rate,
at which commercial banks borrow from the RBI, now stands at 6%. The RBI
expressed that it does not expect inflation to cross 3.8% in FY20. The RBI
adjusts the reverse-repo-rate to 5.75% and Marginal Standing Facility (MSF)
bank rate adjusts to 6.25%
Governor Shaktikanta Das said that India’s Gross Domestic Product (GDP) is
expected to be at 6.8% to 7.1% in the first half of FY-20 and at 7.3% to7.4% in
the second half of FY-20.
after the rate-cut announcement, the share benchmark indices plunged further
and the BSE Sensex was at 38,740-level, down by 136points at around 12:00
hours, while the Nifty50 was trading 11,616-level, down by 27points and Nifty
Bank was quoting 30,021 down by 0.24%.