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Rate Cut Rbi
Besides, the apex bank also pumped in Rs 11,000 crore (Rs 110 billion) in Small Industries Development Bank
[Get Quote] of India [Get Quote] and National Housing Bank to give a fillip to realty and small and medium sectors.The short-term lending rate (repo) will fall to 6.5 per cent and borrowing (reverse repo) rate to 5 per cent with effect from December 8.
The primary liquidity made available to the system through these measures is worth over Rs 3,00,000 crore (Rs 3,000 billion), RBI Governor D Subbarao said in Mumbai.
RBI also allowed select banks to buyback foreign currency convertible bonds from customers to 'take advantage of current discounted rate at which these bonds are trading.'
Announcing the fresh measures, Subbarao said that 'taken together with earlier measures, these would step up demand and arrest the growth moderation.'
He was also confident that the government's decision to lower petrol and diesel prices would further ease inflation.
