India's RBI puts pressure on banks to lower lending rates

April 7, 2015 10:46 AM

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MUMBAI, April 7 (Reuters) - The Reserve Bank of India proposed on Tuesday that banks should decide lending rates based on their marginal cost of funding, hoping the shift will persuade them to lower lending rates faster in response to central bank easing measures.

The RBI kept its key policy rate on hold at 7.5 percent on Tuesday, but is disappointed that after two rates cuts earlier this year just four of 45 Indian banks have lowered their lending rates.

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