RBI keeps Bank Rate same, projects 7.5% growth

By agencies   |   Tuesday, 25 October 2005, 07:00 Hrs
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MUMBAI: The Reserve Bank of India today kept the bank rate unchanged at six percent, in its mid-term review of the monetary policy for the year 2005-06.

However, as expected, in view of the current macroeconomic and over all monetary conditions, the reverse repo rate has been increased by 25 basis points with effect from October 26, 2005 to 5.25 percent from the current level of five percent.

"The repo rate will continue to be linked with the reverse repo rate," RBI said, adding the spread between the two rates has been retained at 100 basis points at present.

The cash reserve ratio (CRR) kept unchanged at five percent. Accordingly, the fixed repo rate under Liquidity Adjustment Facility (LAF) would be 6.25 percent with effect from October 26, 2005.

Announcing the busy season monetary and credit policy, RBI Governor Y V Reddy also hiked the repo rate by 0.25 percent to 6.25 percent.

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