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The Reserve Bank of India (RBI) has declared its new credit policy for the year 2008-09. The announcement was made in a meeting during with the chief executives of the major commercial banks of the country. Here are the highlights of the new credit policy of the RBI:
- Bank rate, Repo Rate and Reverse Repo Rate have been unchanged.
- Banks are required to maintain a CRR of 8.25% with effect from May 24, 2008.
- Emphasis has been given on price stability and lower inflation rates.
- GDP for the year 2008-09 has been projected at 8 to 8.5%.
- he RBI has expected that inflation will be brought down to 5.5% in 2008-09 and it aims to bring it down to 5% as soon as possible.
- The aim of RBI is to devise polices so that the inflation stays between 4 to 4.5% and the actual inflation rate is around 3%. This is the mid term projection of the new credit policy.
- M3 is to be kept in the range of 16.5 to 17% during the year 2008-09.
- Deposits are expected to increase to Rs 5, 50,000 crore during 2008-09.
- Non - Food Credit is expected to increase by 20% during 2008-09.
- It is expected that liquidity will be managed through the proper use of CRR and Open Market Operation (OMO) which includes MSS and LAF.
- STRIPS would be included in government securities by the end of 2008-09.
- Continuous fast response to changing international and domestic developments will be provided through orthodox and unorthodox measures.
