RBI cuts SLR, releases Rs 60,000 crore
- RBI slashed the Statutory Liquidity Ratio (SLR) by 1 percentage point from 24 % to 23 % which is expected to provide liquidity of around Rs 60, 000 crore.
- It kept the major indicative policy rates unchanged while it slashed the gross domestic product (GDP) projections for the current financial year from 7.3 % to 6.5 % and raised the inflation forecast from 6.5 % to 7 %.
- India’s is facing a slowing growth and increasing inflation problem.
- The Repo rate is untouched at 8%.
- The Cash Reserve Ratio (CRR) is at 4.75 %.
- The cut in SLR is expected to ensure that liquidity pressures do not hamper the flow of credit to the productive sectors of the economy. The move will facilitate banks to shift their portfolio in favor of the private sector.