New
Delhi: An ordinance, which seeks to empower the Reserve
Bank of India (RBI) to cut the statutory liquidity ratio
(SLR) to below 25 per cent, is expected to be brought
in by this month-end or early February.
The
Reserve Bank is slated to come out with its quarterly
monetary and credit review on January 31.
Under
the present requirements of SLR, banks have to keep 25
per cent of their total deposits in the form of liquid
assets comprising cash, gold and approved securities,
mostly government bonds.
Last
week, the cabinet cleared the ordinance to cut the floor
limit of SLR. The decision to bring an ordinance to amend
Banking Regulation Act, 1949, would provide RBI more operational
flexibility in the conduct of monetary policy.
Sources
said an ordinance could only be promulgated before the
president summons the Parliament, which is generally 21
days before the session.
If
the session begins on February 23, as is expected, then
the President is expected to summon the houses by February
2 in which case the ordinance cannot be issued after February
1.
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