India's central bank slashed key interest rates by 1 percentage point Saturday amid signs of slowing economic growth and damaged investor confidence following the recent terror attacks in Mumbai, AP reported. The cut, to take effect Monday, will bring the benchmark repo rate, at which the central bank makes short-term loans to commercial banks, from 7.5 percent to 6.5 percent. That's the lowest since June 2006 and down from an October high of 9 percent. The reverse repurchase rate _ the rate at which it borrows from commercial banks _ was lowered from 6 percent to 5 percent to encourage banks to lend more to consumers. The Reserve Bank of India also announced measures to ease credit to small businesses, exporters and the real estate sector, all of which have been hit hard by the global economic downturn.
