RBI slashes reverse repo rates

Reserve Bank of India Governor Shaktikanta Das said today while addressing the media amid the nationwide lockdown that the reverse repo rate has been slashed by 25 bps to 3.75%.

He announced a string of money market measures to support the financial system against the fallout from the coronavirus outbreak. He spoke about targeted long-term repo operations worth Rs 50,000 crore. Further, targeted long-term repo operations worth Rs 25,000 crore will be auctioned today.

He noted that the country’s macroeconomic financial situation has deteriorated due to the pandemic. The Services PMI contracted on account of shrinking exports. Further, India’s exports contraction is more severe compared to global financial markets.However, he stated that at a time when major global financial markets remain volatile, India is among handful of countries projected to register positive growth rate and is likely to have a sharp bounce-back.