MW: India increases cash reserve ratio cut to 1.5 points
By V. Phani Kumar
HONG KONG (MarketWatch) -- The Reserve Bank of India Friday announced that it will cut the cash reserve ratio -- the percentage of deposits banks must keep with the central bank -- by 1.5 percentage points, instead of the half-point cut announced earlier this month. The RBI said the decision was taken after a review of the "evolving liquidity situation in the context of global and domestic developments." The CRR will drop to 7.5% with effect from Saturday in the wake of the latest announcement. The reduction would release 600 billion rupees ($12.3 billion) into the banking system. The U.S. dollar jumped to 48.77 rupees recently, compared with 48.01 rupees late Thursday.
