RBI/2004-05/ 441
IDMD.OMO.No. 09/03.75.00/2004-05
April 28, 2005
All Scheduled Commercial Banks (excluding RRBs) and Primary
Dealers
Dear Sir,
Liquidity Adjustment Facility – Increase in Reverse
Repo Rate to 5.00 percent
Please refer to paragraphs 60 and 61 of the
Annual
Policy Statement for the year 2005-06 dated April 28, 2005 and our circular
IDMD.OMO.No.07/03.75.00/2004-05
dated October 26, 2004.
2. In view of the current macroeconomic and
overall monetary conditions, it has been decided, to increase the fixed reverse
repo rate by 25 basis points under the Liquidity Adjustment Facility (LAF) effective
from April 29, 2005 to 5.00 per cent from 4.75 per cent.
3. The repo rate will continue to be linked
to the reverse repo rate, as at present. However, the spread between the reverse
repo rate and the repo rate is reduced by 25 basis points, from 125 basis points
to 100 basis points with effect from April 29, 2005. Accordingly, the fixed
repo rate under LAF will continue to remain at 6.00 per cent.
4. All other terms and conditions of the current
LAF Scheme will remain unchanged.
Yours faithfully
(Jasbir Singh)
Chief General Manager
|