05 August 2014

RBI Monetary Policy-2014-15


Third Bi-Monthly Monetary Policy Statement, 2014-15

By
Dr. Raghuram G Rajan, Governor

Monetary and Liquidity Measures

On the basis of an assessment of the current and evolving macroeconomic situation, it has been decided to:

  • keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 8.0 per cent;

  • keep the cash reserve ratio (CRR) of scheduled banks unchanged at 4.0 per cent of net demand and time liabilities (NDTL);

  • reduce the statutory liquidity ratio (SLR) of scheduled commercial banks by 50 basis points from 22.5 per cent to 22.0 per cent of their NDTL with effect from the fortnight beginning August 9, 2014; and

  • continue to provide liquidity under overnight repos at 0.25 per cent of bank-wise NDTL  and liquidity under 7-day and 14-day term repos of up to 0.75 per cent of NDTL of the banking system.

Consequently, the reverse repo rate under the LAF will remain unchanged at 7.0 per cent, and the marginal standing facility (MSF) rate and the Bank Rate at 9.0 per cent.

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