Urjit scores a century on his debut: Cuts rates by 25 bps

Reserve Bank of India's fourth bi monthly policy has driven the market green. The Monetary Policy Committee (MPC) decided to reduce the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 6.5 per cent to 6.25 per cent with immediate effect. Consequently, the reverse repo rate under the LAF stands adjusted to 5.75 per cent, and the marginal standing facility (MSF) rate and the Bank Rate to 6.75 per cent. The decision of the MPC is consistent with an accommodative stance of monetary policy in consonance with the objective of achieving consumer price index (CPI) inflation at 5 per cent by Q4 of 2016-17; and the medium-term target of 4 per cent within a band of +/- 2 per cent, while supporting growth. All the 6 members of the Monetary Policy Committee voted for the rate cuts.Meanwhile, the market cheered with Sensex gaining over 108 points and Nifty gaining almost 35 points.