Repo rate reduced from 4.4% to 4%, reverse repo rate reduced to 3.35%: RBI Governor Shaktikanta Das
Reserve Bank of India (RBI) Governor Shaktikanta Das today announced that the central bank has decided to reduce the repo rate by 40 basis points from 4.4 per cent to 4 per cent. Shaktikanta Das said, the RBI has also decided to reduce the reverse repo rate to 3.35 per cent.
Shaktikanta Das said the decision to cut the repo rate by 40 basis points was taken after a 5:1 vote among the six-member monetary policy committee, adding that the RBI has maintained an accommodative stance and it would keep supporting the economy till required.
Addressing a press conference, Shaktikanta Das said the global economy is set to fall into recession because of the disruption caused by the Covid-19 pandemic. He said however a small ray of hope for India is from the good yield in the Rabi season and a normal monsoon predicted by the India Meteorological Department.
"Private consumption in India has seen biggest blow due to Covid-19 outbreak and the investment demand has halted," Shaktikanta Das said.
He added that due to the Covid-19 crisis, government revenues have been impacted severely. The RBI Governor also said that India's GDP grwth in 2020-21 is set to be in the negative.
"India is seeing a collapse of demand. There is a dip in electricity and petroleum product consumption, along with fall in private consumption," Shaktikanta Das said.