Inflation also causing slowdown: RBI
On the liquidity situation, the RBI Deputy Governor said, there is enough liquidity to take care of the lending activities of the banking system.
"I think liquidity is okay...whatever is the liquidity, that is adequate and comfortable. This is always monitored," he said.
In order to ease liquidity situation, the Reserve Bank last month announced infusion of Rs 17,500 crore by reducing Cash Reserve Ratio (CRR) by 0.25 per cent.
Accordingly, the CRR, or the portion of deposits banks have to park with the RBI, now stands at 4.25 per cent, while the repo rate, at which RBI lends to the system, has been retained at 8 per cent.
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