Encouraged by softening inflation, the RBI on Thursday decided to cut the benchmark interest rate by 0.25 per cent to 7.75 per cent with a view to boost growth. Following reduction in the repo rate, the reverse repo rate has been adjusted to 6.75%.
The decision to reduce repo rate comes a fortnight ahead of the scheduled date of monetary policy announcement on February 3rd.The RBI has been keeping the benchmark interest rate at elevated level at 8 per cent since January.
RATE CUT POSITIVE FOR INDIAN ECONOMY: FINANCE MINISTER
Finance Minister Arun Jaitley hailed the decision of RBI to cut the interest rate, saying it is positive for the Indian economy and will certainly help in reviving the investment cycle the government is trying to restore.
MOS FOR FINANCE SAYS IT IS A WELCOME STEP
Reacting to the RBIs rate cut, Minister of State for Finance Jayant Sinha said that it is a welcome step. He said that the announcements are in line with the government’s recent reform policy initiatives and political willingness to expedite the same.