Reserve Bank of India (RBI) On Thursday said that it will take swift, effective measures as appropriate and will continue to monitor global and local financial markets closely.
RBI will endeavour to minimise stress on various sectors of economy because of the global financial turmoil, the central bank said in a note released following its board meeting at Ahmedabad. Following the series of rate cuts by the central bank since October, market participants are expecting the central bank to soften rates further.
Since October, RBI has cut repo rate by 350 bps, reverse repo by 200 bps and the cash reserve ratio by 400 bps. RBI also reassured markets about maintaining comfortable liquidity.
“The policy objective is to ensure adequate availability of liquidity in the system and to maintain conditions conducive for flow of credit for all productive sectors, particularly housing, export, and small and medium industry sectors.”