The Reserve Bank of India (RBI) has cut the reverse repo rate by 25 bps to 3.75% while there is no change in the repo rate, announced Governor Shaktikanta Das in a video conference on Friday. The RBI Governor was addressing as the economy faces tough times due to the coronavirus outbreak in the country with a global impact as an add on. Further speaking on the measures taken by the government to restrict the impact of COVID-19 on the economy, Shaktikanta Das said LCR requirement of banks has been brought down to 80% from 100% but will be restored in phases by April next year.
Shaktikanta Das also mentioned that banks will not make any further dividend payout in view of financial difficulties arising from COVID-19. A 90-day NPA norm will apply on the moratorium granted on existing loans by banks. RBI will monitor the evolving situation continuously and use all of its tools to deal with pandemic fallout, Shaktikanta Das added.
He further said that the CPI inflation declined in March as inflation is on a declining trajectory. Also, loans given by NBFCs to real estate companies to get a similar benefit as given by scheduled commercial banks, RBI Governor added.