It’s a sign of the extraordinary hit that the Indian economy is expected to take from COVID-19 that India’s central bank has dropped its policy rate by a dramatic three-quarters of a percentage point in one go.
On Friday morning, Governor Shaktikanta Das of the Reserve Bank of India declared that its repurchase—or repo—rate was now 4.40%, down from 5.15% earlier.
In some ways, it was expected. The economy was already in bad shape, and the all-India lockdown—necessary to stem infections—amounts to such a serious disruption of commercial activity that the country would be lucky to register any growth at all in 2020-21.