RBI cut CRR: 4.25%

The Reserve Bank of India (RBI) cut the Cash Reserve Ratio (CRR) by 25 basis points from 4.5 to 4.25 percent.

Why this step?

§  The reduction in the CRR is expected to infuse liquidity to the tune of around Rs. 17,500 crore into the banking system.

§  By doing this RBI intends to preempt a prospective tightening of liquidity conditions, thereby keeping liquidity comfortable and supportive of growth.

RBI issued new guidelines for rehabilitation of sick MSEs

Revising definition of sickness in micro and small enterprises (MSEs), the Reserve Bank asked banks for timely and adequate assistance to them as soon as the signs of sickness are detected.