January 27, 2012: JSW Steel Ltd feels that it is essential to cut policy rates to boost sentiments and revive the investment cycle.

"When there is tight liquidity conditions forcing the banks to borrow Rs 150,000 crore under LAF window, the cut in CRR by 0.5% is, however, very timely to provide liquidity in the banking system," Seshagiri Rao, Jt MD & Group CFO, JSW Steel, said in a statement to ISMW.

The Reserve Bank of India (RBI) left interest rates on hold but cut the cash reserve ratio for banks by 50 basis points on January 24, a move that eases tight liquidity in the banking system and underscores a policy shift from fighting inflation to reviving growth.

The Reserve Bank of India as expected left its policy repo rate unchanged at 8.50% for the second consecutive review, but lowered the CRR to 5.50% from
6.00%.

Source: ISMW