Kick Start 2009 - RBI cuts CRR by 50 bps to 5%, repo rate by 100 bps to 5.5% and reverse repo rate by 100 bps to 4%.

In order to cope up with the Global recession all the country are doing this almost every month and India which was not really into recession is trying to take all the measure to kepp away from it , But its kind of deeper that expected , Out of the various cuts that Reserve bannk of india has did this is the latest

Repor Rate cut
To reduce the repo rate under the liquidity adjustment facility (LAF) by 100 basis points from 6.5 per cent to 5.5 per cent with immediate effect.

Reserve Repo Rate
To reduce the reverse repo rate under the LAF by 100 basis points from 5.0 per cent to 4.0 per cent with immediate effect.


Cash Reserve Ratio - CRR Rate
To reduce the cash reserve ratio (CRR) of scheduled banks by 50 basis points from 5.5 per cent to 5.0 per cent from the fortnight beginning January 17, 2009.
The CRR cut is not immdiate but atleast its happening this si the only gfactor that will put some money in banks hand which in turn can be used by banks for various purpose , So this cut will release 20,000 crore.We can expect more rate cuts in lending loansfrom various banks.

Repo Rate Cuts

Date Cuts
10/10/2008 9%
10/22/2008 8%
11/03/2008 7.5%
12/06/2008 6.5%
02-Jan-2009 5.5%

Since Sep, Repo Rate has been reduced by 350 bps.

CRR History

Date Cuts
10/10/2008 9%
10/13/2008 7.5%
10/16/2008 6.5%
11/10/2008 5.5%
12/06/2008 unchanged
02-Jan-2009 5%

Since Sep, CRR has been reduced by 400 bps.

Reverse Repo Rate

Date Cuts
12/06/2008 5% (reduced by 100 bps)
02-Jan-2009 4%