New Delhi, Aug 25: Two days after repo rate cut, Reserve Bank governor Bimal Jalan today said soft interest rate bias will continue. "The soft interest rate bias is continuing. It will continue," Jalan told reporters, implying that lending rates would either remain at the present level or come down further.
The bank rate, at which RBI lends funds to banks, was slashed by 0.25 per cent to 6.0 per cent in the last April slack season credit policy.
Although RBI had reduced bank rate, it kept repo rate untouched until last Saturday when it was slashed by 0.50 per cent to 4.5 per cent.

The reduction in repo rate could be seen in the wake of fall in inflation rate to 3.95 per cent in the week ended august nine, which means a decline in the real interest rate in the economy.

On top of this, monsoon has been satisfactory in most parts of the country. Bureau Report