After nearly two
years of tight check on money supply to tame inflation, Reserve Bank of India
(India's central bank) took steps on 24.01.2012 (Tuesday) to infuse more
liquidity in the system by reducing a key rate (CRR) to help industry out of
the current downturn.
The Cash ReserveRatio (CRR), the amount against deposits which commercial banks have to keep as
liquid assets such as cash, has been lowered by 50 basis points to 5.5 percent
from 6 percent with effect from 28 January 2012.
"This step
will release Rs. 320 billion into the system," Reserve Bank of India (RBI)
Governor D. Subbarao said in a statement, soon after presenting the third quarter
review of the monetary policy for the current fiscal year.
"The policy
actions and the guidance are expected to ease liquidity conditions, mitigate
downside risks to growth and anchor medium-term inflation expectations on the
basis of a credible commitment to low and stable inflation," he added.
If you want to
check more about the above details, please pay a visit to:
http://rbidocs.rbi.org.in/rdocs/notification/PDFs/CRR240112.pdf
If you wish to
know how CRR requirements affects the money supply, Please wait to check out my next post to have a clear idea.
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Saving Sundays is my initiative to share every Sunday some practical money saving tips to my friends like you. I would be pleased if you could share some saving tips from your own experiences. Drop a comment below or mail me to submit your tip. Do spread the word of mouth about this stuff, if you find it useful.
Saving Sundays is my initiative to share every Sunday some practical money saving tips to my friends like you. I would be pleased if you could share some saving tips from your own experiences. Drop a comment below or mail me to submit your tip. Do spread the word of mouth about this stuff, if you find it useful.
I am very much excited to
read each individual experiences and comments. Click here to read the complete Series of
Saving Sundays.
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