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Highlights Of RBI's First Bi-Monthly Monetary Policy Statement
The Reserve Bank of India on Tuesday cut its policy rate by 0.25 per cent while unveiling its first bi-monthly policy review for this fiscal, paving way for cheaper home and auto loans.

The Reserve Bank of India on Tuesday cut its policy rate by 0.25 per cent while unveiling its first bi-monthly policy review for this fiscal, paving way for cheaper home and auto loans.

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– Repo rate cut by 0.25% to 6.50%
– Reverse repo hiked by 0.25% to 6%
– Cash reserve ratio or CRR unchanged at 4%
– Minimum daily cash maintenance by banks with RBI cut by 5%
– MSF rate cut by 0.75% to lower banks’ borrowing cost
– Policy to remain accommodative going forward
– Pegs 2016-17 growth forecast at 7.6%
– Expects inflation at around 5%
– Cut in small savings rate, MCLR introduction to improve monetary policy transmission
– Government adhering to fiscal consolidation path will help lower inflation
– 7th Pay Commission award to put upward pressure of up to 1.5% on inflation
– Proposes custodian banks; banks focusing on wholesale and long term financing
– Second bi-monthly monetary policy on June 7