RBI cuts CRR by 1 percent, releases additional Rs 40,000 cr

The Reserve Bank of India has further cut by one percent, the amount of mandatory cash that banks need to park with it - a move that would unlock Rs 40,000 crore into the financial system and pave the way for lower lending rates. p align="justify"nbsp;/p p align="justify"This is the third time that the central bank has cut the Cash Reserve Ratio in two weeks, bringing the combined cut to 2.50 percent that released a total of Rs 100,000 crore into the cash-starved banking sector so that they can resume normal lending operations./p p align="justify"nbsp;/p p align="justify"With this cut, the CRR would be 6.5 percent as against 9 percent at the start of this month./p p align="justify"nbsp;/p p align="justify"RBI has also raised the interest rates ceiling on deposits by non-residents by 50 basis points to attract foreign funds inflow. /p p align="justify"nbsp;/p p align="justify"Continuing the fight against the ripple effects of the global financial meltdown, Finance Minister P Chidambaram has announced more steps to inject cash into the system and strengthen the banking sector, while doubling FIIs investment limit in the corporate bond market. (ANI)/p a href="javascript:history.back()"!--img src="TitleImages/Previous.jpg" border=0--/a

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