These latest moves are expected to increase cash in the financial system and help push interest rates down, potentially helping borrowers where an interest rate cut has not. "We want to make sufficient liquidity available, but we cannot open the floodgates of liquidity. Economic growth slowed to 6.6% in the October-December quarter, the worst in five quarters, and economists see a further slowdown in January-March largely due to high interest rates and surging oil prices. The RBI wants the real interest rate — the delta between the inflation rate and rate people pay to borrow — to ease for borrowers, a separate government official said. "There could be two to four more open market operations by the RBI in the next two months (June-July) of similar quantum," the second official said.

Source: Mint May 07, 2019 08:03 UTC