News: The Reserve Bank of India has released its monetary policy committee (MPC) report.
Facts:
Key Highlights:
- Repo Rate:It is the rate at which the RBI lends money to the banks for a short term.It remains unchanged at 4%.
- Reverse Repo Rate:It is the short term borrowing rate at which RBI borrows money from banks.It remains unchanged at 3.35%
- Marginal Standing facility: It is a window for banks to borrow from the Reserve Bank of India in an emergency situation when interbank liquidity dries up completely.It has remained unchanged at 4.25%.
- Additional credit support for housing and rural sectors: RBI will provide additional special liquidity facility of Rs 10,000 crore to NABARD & NHB to improve fund availability.
- Priority Sector Lending(PSL): RBI has brought startups under the purview of priority sector lending(PSL).It has also increased borrowing limits of the renewable energy sector.
- Innovation Hub: RBI will set up an Innovation Hub to further promote and facilitate an environment that can accelerate innovation across the financial sector.
- KV Kamath Committee: RBI has set up a committee under KV Kamath, to make recommendations on the required financial parameters along with the sector-specific benchmark ranges for one time restructuring of loans.
Additional Facts:
- Monetary Policy Committee(MPC): It is a committee of the Reserve Bank of India which consists of six members with three nominated by the Union government and three representing the RBI.
- It is mandated by law to ensure that retail inflation stays within a band of two percentage points of the target inflation rate of 4%.
