ISSUE NO: 17
SEP-OCT
Monetary Policy rate cut - A Game Changer:
Monetary Policy is the process by which the monetary authority of country
controls the supply of money, targeting inflation rate or interest rate to
ensure price stability. It is basically introduced by RBI to control money
supply in economy through various rates like Repo rate, Bank Rate etc.
During the period of Dr.Raghu
Ram Rajan, he tried to maintain
the same rate of inflation but the
new governor Dr.Urjit Patel has
cut down the Repo rate by 25 basis
point. Before understanding the
effect of the change in rate, the
meaning of Repo rate should be
understood. Repo rate is the rate at
which RBI gives loan to banks. If
the RBI cuts the rate, loans will be
cheaper for banks and so banks
will be giving out loans to
per