RBI makes first rate cut of 2017
Central bank is still concerned about weak transmission of policy rate
The Reserve Bank of India (RBI) made its first rate cut of 2017 today (August 2), after the June inflation figure hit a record low.
The central bank cut the policy rate by 25 basis points to 6%, adjusting the rates on its other liquidity operations by the same amount. The monetary policy committee (MPC) voted 4:2 in favour of the action, with one member calling for a 50bp cut and another for a rate hold.
A key factor in the decision was India’s record low rate of consumer price inflation
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