Impact of decreased key rates on Indian economy

Impact of decreased key rates on Indian economyParvez alamG4-116

2Layout of presentationPolicy rates of RBIKey rates at presentReasons for rate cutimpact

Policy rates of RBI3SLR/OMOBank rateCRRRepo rate

These rates determine level of liquidity in the economy

4Key rates at present

Bank Rate9.00%8.75%Repo Rate8.00%7.75%CRR4.25%4%SLR24%23%

Third Quarter Review 2012-13

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9.787.24

Nov,2011Nov,2012WPI

Government can borrow more from RBI Impact on..Interest rates of commercial banks will decrease

Loans will be cheaper

Industries can get cheaper loans.Income will increase, so do inflation

All these increments lead to growth in GDPInterest rateGDPMoney mkt..Govrmnt exp.productionincome7

8THANK YOU