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Liquidity management measures TAKEN BY RBI
Reserve Bank of India (RBI) has raised Repo and Reverse Repo rates by 25 basis points each to 5.50 percent and 4.0 percent respectively. At the same time, some liquidity management measures have been extended.These measures are expected to contain inflation and anchor inflationary expectations without hurting recovery process.
The Finance Minister Mr Pranab Mukherjee has said that these measures are desirable given that core inflation has risen and credit situation is tight. He further said that it is good that RBI has not raised Cash Reserve Ratio(CRR).
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