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The 50 basis point repo rate cut to 6.75 per cent, is a pro-growth policy, according to Chandra Shekhar Ghosh, Founder and MD of Bandhan Bank. The move will act as a “booster dose” for economic growth, he added.
“The Reserve Bank of India governor Dr Raghuram Rajan has surprised the market by announcing a 50 basis points cut in the repo rate. We could not have asked for more,” he said adding that Rajan through this move has “frontloaded the rate cut and committed to continue with an accommodative monetary policy.”
“After unveiling the policy, the (RBI) Governor spoke about discussing with the government the small savings rates. If indeed the government decides to cut the small savings rates, the banks will be in a better position to cut deposit rates and that will lead to faster transmission of the monetary policy. In other words, the banks will be able to cut the loan rates faster,” Ghosh added.
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