RBI's Rajan Favoured Panel View on Rate Cut at April Policy

The RBI lowered the repo rate by 25 basis points to 6.50 percent, the lowest in over five years.

Published: 28th April 2016 06:13 PM  |   Last Updated: 28th April 2016 06:13 PM   |  A+A-


Governor of the RBI Raghuram Rajan speaks at a forum on financial development at the 2016 IMF World Bank Spring Meeting in Washington. REUTERS

MUMBAI: Reserve Bank of India Governor Raghuram Rajan went with the majority view of the external members of its monetary policy committee that suggested a repo rate cut at the April review, according to the minutes released on Thursday.

One member recommended narrowing the interest rate corridor - the rate at which RBI lends and borrows from banks - to 50 basis points from 100 basis points, a suggestion which was also implemented in the policy review on April 5.

The policy committee, which comprises five external members, the governor and four deputy governors, does not have any voting powers and is purely advisory in nature.

The RBI governor is the sole deciding authority on monetary policy decisions.

Two of the four external members suggested a 25-basis-point cut in the repo rate while the other two wanted a 50-basis-point cut, the RBI said. The fifth member suggested that rates be left unchanged.

The RBI lowered the repo rate by 25 basis points to 6.50 percent, the lowest in over five years and also raised the reverse repo rate by 25 bps to 6.00 percent.

Stay up to date on all the latest Business news with The New Indian Express App. Download now


Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on are those of the comment writers alone. They do not represent the views or opinions of or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp