Indian Central Bank Cuts Policy Rate to 6.5%; Raises Reverse Repo

India’s central bank cut its repo rate by 25 basis points to 6.50 percent at a policy review on Tuesday, making a widely expected first reduction since September to bring the rate to its lowest in more than five years.

But in a surprise move, the Reserve Bank of India also raised the reverse repo — or the rate lenders charge to the central bank — by 25 basis points to 6.0 percent, while taking measures to ensure more availability of cash in the banking system.

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Craig Erlam
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the BBC and The Telegraph, and he also appears regularly as a guest commentator on Bloomberg TV, CNBC, FOX Business and BNN. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.