17 March 2012
Cash Reserve Ratio; if cut by RBI; means banks are now required to maintain low cash ratio which means more funds are now available for advancing loans to the business organisations etc. . This is usually cut when banks feel acute shortage of funds and industry outlook is good. . A cut in CRR is taken positive by stock market as it feels that problem is likely to be solved soon. . Please buy a good book of banking terminology.
CAclubindia
