Repo rate is the key interest rate at which it lends short-term funds to commercial banks.The Reserve Bank of India (RBI)'s Monetary Policy Committee (MPC) is expected to deliver a fourth consecutive rate cut of 25 basis points today, according to news agency Reuters.
Repo rate is the key interest rate at which the central bank lends short-term funds to commercial banks.Since February, the RBI has reduced the repo rate by 75 basis points in three successive reviews.
If the RBI delivers a further cut by 25 basis points today, the repo rate would come down to 5.50 per cent, and also make the central bank the most dovish among major Asian central banks.
The last time the RBI made so many back-to-back cuts was after the global financial crisis over a decade ago, when most major central banks were desperate to revive economic growth.Almost 80 per cent of 66 economists surveyed by news agency Reuters expected the RBI to cut its benchmark repo rate by 25 basis points.
Three respondents predicted a 50 basis points cut and the remaining 10 forecast the rate would be left unchanged.One basis point is equivalent to 0.01 per cent.