Cutting cash reserve ratio can improve India liquidity - finance ministry official

IL&FS Engineering and Construction

25/09/2018 10:17

NEW DELHI, Sept 25 (Reuters) - Cutting banks' cash reserve
ratio (CRR), or the amount of funds they set aside with the
central bank, are among options that the central bank could look
at to improve liquidity in the system, a finance ministry
official said on Tuesday.
    The Reserve Bank of India could also consider buying more
bonds from the open market and open a special window for mutual
funds to inject liquidity, the official told reporters,
declining to be identified as the discussions are not public.
 urn:newsml:reuters.com:*:nL4N1WA4A0
    Presently, the CRR is at 4 percent of banks' total deposits.
    After the comments, the 10-year benchmark bond yield
 IN071728G=CC  eased 1 basis point to 8.12 percent from before
the news.

 (Reporting by Manoj Kumar; Editing by Krishna N. Das)
 ((neha.dasgupta@tr.com; +91-11-49548058; Reuters Messaging:
neha.dasgupta.thomsonreuters.com@reuters.net))