Following the 25 bps cut in repo rate and cash reserve ratio, loans may become cheaper soon.
“A cut in lending rates is now possible as the repo rate reduction is also coupled with cut in cash reserve ratio,’’ Bhagavantha Rao, Managing Director, State Bank of Hyderabad , told Business Line on Tuesday.
State Bank of Hyderabad’s asset-liability committee will meet in about a week to take a call on reduction in lending rates.
The cut in key policy rates by the apex bank today, though expected should not be seen in isolation, he said, adding: “I see this as a starting point for further easing of rates in the days to come.’’
He said that the markets have already factored the repo rate cut. The CRR cut could be due to the tight liquidity scenario faced by banks in the last two weeks, Rao added.