CRR
Cash Reserve Ratio
MacroeconomicsThe share of deposits banks must hold as cash with the RBI, earning no interest. Changing it directly adds or drains banking-system liquidity.
Formula
Required Reserve = CRR x Net Demand and Time Liabilities
Why it matters
A CRR cut releases lendable funds instantly, making it a powerful liquidity tool distinct from the price signal of the repo rate.
Indian example
Related terms
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