RBI opens it’s pandora for war against COVID-19

RBI has announced measures aimed at minimizing the damage from Covid-19.

These measures came hours after Moody's cut India's growth to 2.5% from 5.3% for 2020

The repo rate will be reduced by 75 basis points to 4.4 per cent.

The reverse repo rate was cut by 90 bps to 4 per cent, creating an asymmetrical corridor.

A moratorium of three months of EMIs on all outstanding loans was announced.

It stands for all commercial, regional, rural, NBFCs and small finance banks

For the next three months, no EMI would be deducted from the account of anyone

And all this without any hit on credit score.

EMIs will resume after the moratorium period gets over.

This is going to be a huge relief for all EMI payers

whose income had become uncertain in the wake of the lockdown.

The 3-month moratorium will apply to corporate loans, home loans and car loans.

Personal loans will also qualify for this.

But credit card dues won’t be part of this moratorium as it’s not a term loan.

Make no mistake, it is a fight never seen before, the RBI governor warned..

...while outlining the risks to Indian economy from coronavirus.

He stressed upon the need to keep the credit flowing to the stressed areas of the economy.

Das announced that inflation will be made to remain within target.

Das predicted a big recession coming for all the world, and said India won't be immune.

It all depends how India responds to the situation, Das said.

Global slowdown could make things difficult for India too, despite some help from falling crude prices, he said.

Food prices may soften further on record crop, he added.

Aggregate demand may weaken and ease core inflation further, he said.

A total Rs 3,74,000 crore will me maintained into the country's financial system.

He implored Indians not to worry about their bank deposits.