After Centre, now Big Relief by RBI : EMI Postponed, More Liquidity & Cheaper Loans…

By, thefocus_admin - March 27, 2020 10:54:57

0

NEW DELHI : A day after finance minister Nirmala Sitharaman released a ₹1.7 lakh crore package to combat the impact of the 21-day coronavirus lockdown, Reserve Bank of India (RBI) Governor Shaktikanta Das today cut interest rates by 75 basis points to 4.4%.

Highlights of RBI Governor Shaktikanta Das’s address:

RBI will continue to remain vigilant and take whatever steps are required to mitigate the impact of Covid-19
2.8 lakh crore liquidity measures taken.
Reverse repo-rate reduced by 90 basis points to 4%
MPC has decided to cut the repo rate by 75 basis points to 4.4%.
CRR (cash reserve ratio) of all banks to be cut by 100 bps to 3%. It will provide liquidity of Rs 1.37 lakh crore.
Financial markets are under stress; require steps by central bank for market stability and revival of economic growth.
All banks and NBFCs are being permitted to allow a 3-month moratorium on payment of term loans: Das
Outlook highly uncertain and negative in view of outbreak of Covid-19: Das
Monetary policy committee refrains from giving out growth, inflation outlook for coming fiscal on uncertain outlook
Food prices may soften further on back of record foodgrain production
The outlook is now heavily contingent upon the intensity, spread & duration of the pandemic.
There is a rising probability that large parts of the world will slip into recession
MPC noted that global economic activity has come to a near stand-still as COVID-19 related lockdowns and social distancing in affected countries. Expectations of a shallow recovery in 2020 from 2019’s decade low in global growth have been dashed: RBI Guv
Living in extraordinary situation; war effort needs to be mounted against coronavirus using conventional, unconventional tools
Time has now come for the RBI to launch an array of arsenals to mitigate the impact of Covid-19
Slump in crude oil prices could provide some relief.