RBI reduced policy repo rate by 25 bps to 7.25% on 2nd June 2015. Consequently, the reverse repo rate stands at 6.25% and the Marginal Standing Facility (MSF) rate at 8.25%.
Other key rates- CRR and SLR are held unchanged at 4% and 21.5% of NDTL respectively.
The forward guidance presents worrying outlook on inflation front- with Jan-16 CPI inflation forecast revised upwards from 5.8% to 6%. In view of weak growth recovery, the rate cut is a front-loaded policy action, while RBI awaits further data for clarity.