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Following are the highlights of RBI’s first bi—monthly monetary policy statement, 2016—17:
Repo rate cut by 0.25% to 6.50%
Reverse repo hiked by 0.25% to 6%
Cash reserve ratio or CRR unchanged at 4%
Minimum daily cash maintenance by banks with RBI cut by 5%
MSF rate cut by 0.75% to lower banks’ borrowing cost
Policy to remain accommodative going forward
Pegs 2016—17 growth forecast at 7.6%
Expects inflation at around 5%
Cut in small savings rate, MCLR introduction to improve monetary policy transmission
Government adhering to fiscal consolidation path will help lower inflation
7th Pay Commission award to put upward pressure of up to 1.5% on inflation
Proposes custodian banks; banks focusing on wholesale and long term financing
Second bi—monthly monetary policy on June 7
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