The Reserve Bank of India (RBI) on Friday, June 6, reduced the key lending rate, or repo rate, by 50 basis points, bringing it down to 5.5% from 6%.
The decision was announced after the central bank’s Monetary Policy Committee (MPC), led by Governor Sanjay Malhotra, concluded its three-day meeting that began on June 4.
“After a detailed assessment of the evolving macroeconomic and financial developments and the economic outlook ahead, the MPC decided to reduce, which is rightly expected, under the Liquidity Adjustment Facility by 50 basis points to 5.5%. Consequently, the Standing Deposit Facility rate, which is the SDF rate, shall stand adjusted to 5.25%,” the RBI Governor said.
This is the third rate cut in a row, following a 25 basis point reduction in April.
Sanjay Malhotra also announced the change in stance by RBI. RBI changed its stance to neutral from its earlier stance of accomodative.
