On April 9th the Reserve Bank of India s RBI s Monetary Policy Committee MPC decided to make a signi...........

Economic Affairs Money Supply and Monetary Policy

On April 9th, the Reserve Bank of India’s (RBI’s) Monetary Policy Committee (MPC) decided to make a significant monetary adjustment. What action did they take?

Cut the repo rate by 25 basis points to 6%

Increased the reverse repo rate by 25 basis points

Maintained a neutral monetary policy stance

Decided to absorb more liquidity from the economy

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Explanation:

The decision was to cut the repo rate by 25 basis points to 6% on April 9th, signaling a shift to an "accommodative" policy stance, unlike maintaining a neutral stance.

Increasing the reverse repo rate or absorbing more liquidity would be contrary to an accommodative approach.