Another rate cut to support growth: MPC minutes

As per the minutes, Deputy Governor Gupta was also of the opinion that a 50 bps reduction in repo rate should help foster policy certainty and faster transmission than a staggered rate cut and more effectively counter the challenges emanating from the global economy

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Reserve Bank of India Governor Sanjay Malhotra said front-loading of monetary policy rate action would give a clear signal and some certainty to the economic agents that the central bank is supportive of growth amid global tensions, MPC meeting minutes released Friday said.

June 6, RBI governor-headed six-member panel reduced the benchmark short-term lending rate by 50 basis points, taking the total reduction to 100 bps in quick succession, besides a change in the policy stance to neutral from accommodative and liquidity infusion measures.

While five members voted for a 50 bps reduction in the repo rate during the three-day meeting (June 4-6), an external member of the panel, Saugata Bhattacharya, suggested a 25 bps cut.