RBI follows global banks, cuts repo rate by 75 bps to fight coronavirus

The move comes after the global central banks have been cutting rates to help shore up the economy amid coronavirus pandemic

Following in the footsteps of global central banks, the Reserve Bank of India (RBI) on Friday lowered the key repo rate by 75 basis points (bps) to 4.4 per cent, to help arrest the economic slowdown in the wake of the coronavirus (Covid-19) outbreak. The reverse repo rate now stands at 4 per cent, down 90 bps.

Repo rate is the rate at which a country’s central bank lends money to commercial banks, and reverse repo rate is the rate at which it borrows from them.

MPC voted 4-2 in favour of the reduction of the repo rate by