India's central bank cuts lending rate to 6%

Reserve Bank of India Governor Shaktikanta Das smiles during a press conference to announce the first bi monthly monetary policy in Mumbai, India, Thursday, April 4, 2019. India's central bank has lowered its key interest rate by a quarter of a percentage point to 6% to strengthen domestic growth ahead of a national election next week. (AP Photo/Rajanish Kakade)
Reserve Bank of India Governor Shaktikanta Das smiles during a press conference to announce the first bi monthly monetary policy in Mumbai, India, Thursday, April 4, 2019. (AP Photo/Rajanish Kakade)

NEW DELHI — India's central bank cut its key interest rate by a quarter of a percentage point to 6% on Thursday, moving to prop up economic growth ahead of a national election next week.

The interest rate is what the federal bank charges on lending to commercial banks.

Lower interest rates help borrowers, though they can also spur inflation. The rate cut comes amid a deterioration in the outlook for regional and global growth.

In a bimonthly review of the economy released on Thursday, the Reserve Bank of India cut the retail inflation forecast to 2.9-3% for the first half of this fiscal year. It cited lower food and fuel prices and expectations for a normal rainy season.

In its February policy statement, the RBI had projected retail inflation at between 3.2-3.4%.

India's financial year runs from April-March.

The Reserve Bank of India said in a statement that the economy, which is one of the fastest growing in the world, is facing headwinds, especially on the global front. It lowered its economic growth forecast for 2019-20 to 7.2% from the 7.4% it had estimated in February.

Growth fell to 6.6% in December quarter, the slowest in five quarters.

"The need is to strengthen domestic growth impulses by spurring private investment which has remained sluggish," the central bank said.

Must Read

UNHCR: 123,000 Rohingya refugees have fled Myanmar

Sep 5, 2017

The UN refugee agency says about 123,000 Rohingya refugees have entered Bangladesh since violence...

Aid groups struggle as more Rohingya flood into...

Sep 7, 2017

Aid agencies struggle as more Rohingya flood into Bangladesh, with the U.N. counting 146,000...

Rohingya rebels declare truce as desperation hits...

Sep 10, 2017

Rohingya insurgents declare a monthlong truce as refugees continued to flood across the border into...

The Latest: India urges Myanmar to act with...

Sep 10, 2017

The Latest: India has urged Myanmar to handle the situation in its Rakhine state with restraint...

The Latest: Bangladesh lambasts Myanmar for...

Sep 12, 2017

The Bangladeshi leader lambasts Myanmar for "atrocities" drove hundreds of thousands of Rohingya...

About Us

Get all the up-to-date breaking news about politics, business, entertainment, sports, lifestyles, weather, traffic, and local news in a seamless digital environment only in Morning Dispatcher.

Contact us: sales[at]morningdispatcher.com

Subscribe Now!

Quick Links

HomePress