Economics · Monetary Policy
If the RBI simultaneously increases the Cash Reserve Ratio (CRR) and decreases the Statutory Liquidity Ratio (SLR), the combined impact on the banking system's money flow is most likely to:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Strengthen fiscal consolidation targets directly
- 2Completely eliminate systemic inflation
- 3Reduce immediate cash liquidity but potentially ease long-term credit constraints✓
- 4Increase overall system liquidity sharply
Correct answer
Reduce immediate cash liquidity but potentially ease long-term credit constraints
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