Short-term debt funds to benefit from RBI's moves

In the last MPC meeting of financial year 2019-20, the RBI chose to keep the policy rates unchanged at 5.15% for the repo rate and 4.90% for the reverse repo rate and kept the policy stance unchanged at accommodative. After operation twist, the RBI today introduced Long term Repo (LTRO), one more tool to enable better monetary policy transmission. The LTRO will allow banks to borrow for the one year and 3-year periods at the policy repo rate of 5.15%." It gives banks 1 year and 3 year committed money at the repo rate of 5.15%.

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