One
member recommended narrowing the interest rate corridor - the
rate at which RBI lends and borrows from banks - to 50 basis
points from 100 basis points, a suggestion which was also
implemented in the policy review on April 5.
The policy committee, which comprises five external members, the
governor and four deputy governors, does not have any voting
powers and is purely advisory in nature.
The RBI governor is the sole deciding authority on monetary
policy decisions.
Two of the four external members suggested a 25-basis-point cut
in the repo rate while the other two wanted a 50-basis-point
cut, the RBI said. The fifth member suggested that rates be left
unchanged.
The RBI lowered the repo rate <INREPO=ECI> by 25 basis points to
6.50 percent, the lowest in over five years and also raised the
reverse repo rate <INRREP=ECI> by 25 bps to 6.00 percent.
(Reporting by Suvashree Dey Choudhury; Editing by Sherry
Jacob-Phillips)
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