RBI extends moratorium on loans for another three months1 min read . Updated: 22 May 2020, 10:41 AM IST
- The Reserve Bank of India today cut key repo lending rate by 40 basis points to 4%
- This is likely to bring down lending and deposit rates
The RBI today announced a further extension on moratorium of loans by another three months. In March, RBI had also allowed a three-month moratorium on payment of all term loans due between March 1, 2020 and May 31, 2020.
The RBI will use all its instruments and fashion new ones to meet Covid-related challenges, RBI governor Shaktikanta Das reiterated.
The Reserve Bank of India today cut key repo lending rate by 40 basis points to 4%. This is expected to bring down lending rates and deposit rates as well. RBI's monetary policy committee in an off-cycle meeting voted 5-1 for a 40 bps repo rate cut, while maintaining an accommodative stance. Reverse repo gets automatically gets adjusted to 3.35% from 3.75%.
"We must have faith in India's resilience and come out of all odds," the RBI chief said, adding that the inflation outlook is uncertain at this point.
“After extensive discussions, the monetary policy committee voted unanimously for a reduction in policy repo rate and for maintaining the accomodative stance of the monetary policy as long as necessary to revive growth and to mitigate the impact of Covid-19 while ensuring that inflation remains within the target," Das said.