RBI eases liquidity, ball back with govt

RBI governor Raghuram Rajan has not really surprised anyone. He has eased the constraining policy rate, the marginal standing facility (MSF) rate, by 25 basis points, and raised the repo and reverse rates by 25 basis points. With the reverse repo rate at 6.75%, the repo rate at 7.75% and the MSF rate at 8.75% along with the bank rate, the RBI has completed recalibration of these policy rates at the desired intervals from one another, from which departure had been necessitated by use of overly cheap short-term money for speculation against the rupee in the recent past.

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