MUMBAI -- The Reserve Bank of India on Tuesday cut its benchmark policy rate by 50 basis points to 6.75%. This might be the last incentive market players will see from the country's central bank through the end of the fiscal year. With the "front loaded" move, the bank has accommodated a likely spike in consumer prices during the next three to four months. And it is likely to be patient while banks pass on the benefits of the rate cut to their borrowers.
So far in 2015, India's central bank has slashed its overnight lending rate, or repo rate, by 125 basis points. With the 50 basis point cut on Tuesday, the repo rate now stands at a four-and-a-half year low.
