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RBI Policy: Repo rate cut by 25 bps, GDP projected at 7.4%, EMIs may come down

Stating that the inflation will remain contained, Das added the investment activity is currently recovering owing to the public spending on infrastructure.

RBI Governor Shaktikanta Das, in his maiden RBI Policy, has projected GDP at 7.4% for the financial year 2019-20. The RBI has also brought down the Repo rate by 0.25 basis points bringing it from 6.5% to 6.25% which may bring down the EMI amount paid by individuals. Repo rate is the rate at which the RBI lends money to commercial banks in case of shortfall of funds.


Stating that the inflation will remain contained, Das added the investment activity is currently recovering owing to the public spending on infrastructure.

Das further added that the RBI has decided enhancement of collateral free agriculture loan from Rs 1 lakh to Rs 1.6 lakhs. This enhancement Rs 60,000 has been taken in view of the overall rise in inflation, marginal agriculture input and benefit to small farmers. He added that the import growth had turned slow in November and had actually turned negative in December 2018 primarily owing to high base effect and weak global demand. The inflation rate is estimated at 3.2% to 3.4% in the first half of 2019-2020 and 3.9% in the third quarter of 2019-2020.

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