Multiple Choice Questions

The Reserve Bank has announced a hike in cash reserve ratio CRR by 50 basis points to per cent effec...........

General Awareness : Finance Indian Economy

The Reserve Bank has announced a hike in cash reserve ratio (CRR) by 50 basis points to ________ per cent, effective May 21, 2022.

This questions was previously asked in

RBI Grade B (28 May 2022)

3.5%

4.5%

3.9%

- Cash Reserve Ratio (CRR) is the percentage of a bank's total deposits required to be maintained as reserves with the central bank.

- A hike in CRR indicates tightening of monetary policy, aiming to control inflation by reducing liquidity.

- Options for the new CRR after a 50 basis points increase are:

- Option 1: 3.5% - This implies a decrease which is incorrect for a hike scenario.

- Option 2: 4% - This would suggest an unchanged CRR, incorrect as it does not reflect a 50 basis points increase.

- Option 3: 4.5% - This is correct, as it reflects a 0.5% increase from the prior CRR of 4%.

- Option 4: 5% - This is inaccurate as it implies a 150 basis points increase.

- Option 5: 3.9% - This would imply a very specific and incorrect decimal increase.

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