For third time in a row, the Reserve Bank of India (RBI), in its Second Bi-Monthly Monetary Policy Statement, 2019-20, has cut the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points (bps) to 5.75% from 6.0% in line with expectation. Consequently, the reverse repo rate under the LAF stands adjusted to 5.50%, and the marginal standing facility (MSF) rate and the Bank Rate to 6.0%.
The Monetary Policy Committee (MPC) of RBI has also decided to change the stance of monetary policy from neutral to accommodative.