Highlights: RBI cuts repo rate by 40 bps; extends loan moratorium till August
New Delhi, May 22: Reserve Bank of India Governor Shaktikanta Das while addressing a press conference on Friday said that the Monetary Policy Committee, in an unscheduled meeting, cut policy repo rate by 40 basis points to 4.0 per cent.
The RBI has also extended the three-month loan moratorium by another three months till August 31.
Here are the highlights:
- The RBI Governor announced refinancing support to the tune of Rs 50,000 crore through all India financial institutions such as Nabard, SIDBI and NHB.
- Global economy is headed towards recession, says RBI Guv
- Policy repo rate cut by 40 basis points - from 4.4 per cent to 4 per cent
- Value of global trade contracted by 3 per cent in Q1CY20, says RBI Guv
- RBI maintains accommodative stanceEconomic activities have been impacted severely by two-month lockdown
- Reverse repo rate cut by 40 bps to 3.35 per cent from 3.75 per cent earlier
- GDP growth expected to remain in negative category
- Inflation to remain firm in the first half of 2020 but ease later on.
- RBI extends the three-month moratorium, from June 1 to August 31
- Rs 15,000 crore to EXIM banks
- Maximum permissible period of pre and post shipment of credits increased from 1 year to 15 months
- Group exposure limit of banks will be increased from 25 per cent to 30 per cent
- Voluntary retention route for FPIs
- Another 90 days extension for the 90-day term loan facilities offered
- This will provide additional liquidity support to the MSME sector
The address comes ahead of the meeting of RBI's monetary policy committee between June 3-5 and RBI. The committee is likely to announce its second bi-monthly policy of 2020-21 on June 5.
The coronavirus pandemic and the lockdown had forced RBI to advance its first bi-monthly policy announcement by a week to March 27.