When the Reserve Bank of India reduces the Statutory Liquidity Ratio by 50 basis points,
which of the following is likely to happen?

Question

When the Reserve Bank of India reduces the Statutory Liquidity Ratio by 50 basis points, which of the following is likely to happen?

Accepted Answer

(C) Scheduled Commercial Banks may cut their lending rates.

Answer

(A) India's GDP growth rate increases drastically

Answer

(B) Foreign Institutional Investors may bring more capital into our country

Answer

(D) It may drastically reduce the liquidity to the banking system