**Summary:**
RBI/2019-20/2033 FMOD.MAOG. No.134/01.01.001/2019-20
Effective August 7, 2019, the Reserve Bank of India (RBI) announced a reduction in the policy Repo rate under the Liquidity Adjustment Facility (LAF) by 35 basis points, decreasing it from 5.75% to 5.40%. Consequently, the Reverse Repo rate under the LAF is adjusted to 5.15%. All other terms and conditions of the existing LAF scheme remain unchanged. This decision was made by the Monetary Policy Committee (MPC) as announced in the Third Bimonthly Monetary Policy Statement, 2019-20. For further information, contact Radha Shyam Ratho, Chief General Manager, Financial Markets Operations Department, Central Office, at Tel: 22610642, Fax No: 22630981, or Email: cgmfmod@rbi.org.in. The office is located at 1st Floor, Main Building, Shahid Bhagat Singh Road, Fort, Mumbai-400 001, India.
Key Entities Referenced
Liquidity Adjustment Facility: A monetary policy instrument used by the Reserve Bank of India (RBI) that allows banks to borrow money through repurchase agreements or lend money to the RBI through reverse repurchase agreements.
LAF Scheme: Refers to the existing scheme related to the Liquidity Adjustment Facility.
Monetary Policy Committee: The MPC is responsible for setting the benchmark interest rate in India.
Repo rate: The rate at which commercial banks borrow money from the Reserve Bank of India (RBI) against government securities.
Reverse Repo rate: The rate at which the Reserve Bank of India (RBI) borrows money from commercial banks.
Radha Shyam Ratho: Chief General Manager, Financial Markets Operations Department, Reserve Bank of India (RBI).
Mumbai, Maharashtra: Location of the Central Office, Financial Markets Operations Department, Reserve Bank of India.
Reserve Bank of India: The central bank of India.
RBI/2019-2020/33
FMOD.MAOG. No.134/01.01.001/2019-20
August 7, 2019
All Liquidity Adjustment Facility (LAF) participants
Madam/Sir,
Liquidity Adjustment Facility – Repo and Reverse Repo Rates
As announced in the Third Bi-monthly Monetary Policy Statement, 2019-20, today, it has
been decided by the Monetary Policy Committee (MPC) to reduce the policy Repo rate
under the Liquidity Adjustment Facility (LAF) by 35 basis points from 5.75 per cent to 5.40
per cent with immediate effect.
2. Consequently, the Reverse Repo rate under the LAF stands adjusted to 5.15 per cent
with immediate effect.
3. All other terms and conditions of the extant LAF Scheme will remain unchanged.
Yours sincerely
(Radha Shyam Ratho)
Chief General Manager
Financial Markets Operations Department, Central Office, 1st Floor, Ma in Building, Shahid Bhagat Singh Road, Fort, Mumbai-400 001, India
Tel : 22610642 Fax No:22630981 E-Mail : cgmfmod@rbi.org.in