RBI Governor: Repo Rate Reduced From 4.4% To 4%, Reverse Repo Rate To 3.35%

Reserve Bank of India (RBI) Governor Shaktikanta Das announced that the repo rate has been cut by 40 basis points from 4.4 % to 4%. Addressing the media on Saturday, the RBI Governor also stated that the reverse repo rate stands reduced to 3.35%

The RBI Governor said that the world is heading towards a recession and that COVID-19 has severely crippled the global economy. The Reserve Bank of India governor pointed out that private consumption had been severely hit and this, in turn, impacted the economy.

Shaktikanta Das described agriculture as one core area which stood out as a beacon of hope. He pointed out that the drop in crude oil prices has also severely impacted the revenues.

The RBI Governor also stated that imports have come down by 58.6% and that the demand for investment has come to a virtual halt. Shaktikanta Das said that food inflation shot up to 8.6% in April. Foreign reserves of the country have risen by 9 billion, he said. The RBI Governor expected normalcy to return to the economy in the second half of the year.

The RBI Governor, Shaktikanta Das also said that the GDP growth in 2020-2021 is expected to remain in the negative category with some revival in the second half.