Reserve Bank of India has reduced CRR from 4.25% to 4%. Will this step help in controlling inflation in India ? Name any one value violated in the question.

Reserve Bank of India has reduced CRR from 4.25% to 4%. Will this step

1.	Reserve Bank of India has reduced CRR from 4.25% to 4%. Will this step help in controlling inflation in India ? Name any one value violated in the question.
Answer» This step is not likely to check inflation because a cut in CRR is supposed to releases more liquidity in the economy. This will increase lending capacity of commercial banks resulting in more consumption expenditure and investment expenditure. Hence, this step may prove inflationary instead of checking price rise. Value violated - Social responsibility.