(PTI)
The Reserve Bank of India (RBI) is expected to cut interest rates by 75 basis points by March 2021 as monetary easing measures till now are insufficient to lift the economy reeling under the stress of the Covid-19 pandemic, Fitch Solutions said.
“In the light of a widening interest rate corridor as well as other aggressive monetary easing measures by the RBI, we have revised our expectations to 75 bps worth of cuts by March 2021, which imply a repo rate of3.65 per cent and a reverse repo rate of 3.00 per cent,” it said.
On April 17, the RBI announced a range of additional liquidity enhancing measures aimed at supporting credit flow to the economy. These measures included a 25 bps cut to its reverse repurchase (repo) rate to 3.75 per cent to lower the incentive for banks to park their surplus funds with the central bank.
