RBI infuses over Rs 4,00,000 cr in last 4 months

MUMBAI: The Reserve Bank on Tuesday said it has infused over Rs 4,00,000 crore into the system through series of monetary easing measures taken since mid-September, 2008.

"The actions of the Reserve Bank since mid-September 2008 have resulted in augmentation of actual or potential liquidity of over Rs 3,88,000 crore," the central bank said in its third quarter review of the Monetary Policy for 2008-09.

In addition, the permanent cut in statutory liquidity ratio, percentage of deposit required to be parked in government securities, by one per cent has resulted in injection of funds of the order of Rs 40,000 crore for the purpose of credit expansion.

In all, RBI has infused Rs 4,28,000 crore in the last four months.

The statement noted that the liquidity situation has improved significantly following several measures taken by the RBI.

Since mid-September, the cumulative reduction in the cash reverse ratio (CRR), released Rs 1,60,000 crore into the banking system.

The apex bank also released over Rs 63,000 crore through unwinding of market stabilisation schemes (MSS) in the period.

Through various refinance facilities windows to banks and financial institutions, the potential liquidity of Rs 80,000 crore was made available and through the repo window liquidity of Rs 60,000 crore was infused, the bank said.

The Reserve Bank added that the special purpose vehicle for non-banking financial companies (NBFCs) will augment potential liquidity by another Rs 25,000 crore.