The Reserve Bank of India (RBI) on Wednesday said that weekly withdrawal limit for savings accounts will be increased from Rs 24,000 to Rs 50,000 from February 20 while there will be no limit on withdrawal from March 13.
RBI had imposed these limits in November last year after the government announced a ban on old high-value currency notes, and began to replace them with new notes. Effective February 1, restrictions on daily withdrawal of money from ATMs and from current accounts effective had already been lifted.
For the second time in a row, the RBI today opted for a status quo in its key rates but shifted the stance of the monetary policy from 'accommodative' to 'neutral'. Accordingly, the repo rate at which it lends to the system stands at 6.25 percent and the reverse repo rate at which it absorbs excess liquidity is also retained at 5.75 percent.
The monetary policy committee said it is "committed to bringing headline inflation closer to 4.0 percent on a durable basis and in a calibrated manner" and this requires further "significant decline in inflation expectations, especially since the services component of inflation that is sensitive to wage movements has been sticky.
This is RBI's second monetary policy review after demonetisation of old Rs 500 and Rs 1,000 currency notes.