RBI key exchange rates unchanged |
Reserve Bank of India Governor Raghuram Rajan disappointed markets on April 7 as he kept the key exchange rates unchanged. Repo rate — the rate at which bank`s borrow from RBI — continues to be at 7.5%, and, cash reserve ratio — deposit parked with RBI — remains at 4%. Rajan gave hopes that home and auto loans would get cheaper as the central bank said that it is determined to push banks to lower lending rates. Unseasonal rains and hailstorm have impacted Rabi crops across north and western India, raising fears of spike in food prices. The RBI projected a CPI inflation of 6% for March 2016 and 4.5% for March 2018. It expects India to achieve economic growth of 5.8% by the end of this fiscal year. Rajan said banks not lowering EMIs is `Nonsense`, a harsh comment that reportedly reflects the uneasiness of the RBI with banks, who have not lowered lending rates despite the RBI slashing Repo rate from 8 per cent to 7.5 per cent between January and March 2015.
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