RBI May Go For Another CRR Cut
New Delhi
The Reserve Bank today indicated that it could go in for another cut in the Cash Reserve Ratio (CRR) to unlock banking funds in view of persistent pressure on the liquidity situation.
“We are watching the liquidity situation… I think that decision (another CRR cut) will be taken when we do our mid-quarter review… Having done one, I think the possibility of another is always on the table,” RBI Deputy Governor Subir Gokarn told reporters on the sidelines of a NHB function.
In order to ease the liquidity problem in the system, the RBI in its quarterly policy review earlier this month lowered the cash reserve ratio — the portion of deposits that banks are required keep with the central bank — to 5.5 per cent from 6 per cent, thereby infusing Rs 32,000 crore into the system.
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