India central bank slashes rates

India's central bank slashed interest rates on Friday in an effort to contain the economic fallout of the world's largest coronavirus lockdown and warned the economy could contract this year.

Even before almost all activity shut down in late March, Asia's third-largest economy was struggling to gain traction with sluggish growth, record unemployment and banks reluctant to lend.

The Reserve Bank of India (RBI) slashed the repo rate, the rate at which it lends to commercial banks, by 40 basis points to 4.0 percent, the second cut this year.

The RBI also lowered the reverse repo rate, the rate at which it borrows from commercial banks, by 40 basis points. The bank had cut the repo rate by 75 basis points in March as fears grew over the spread of the virus in the country of 1.3 billion people.