RBI has preserved financial stability of economy during COVID crisis, says Subbarao
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Last Updated: Dec 16, 2020, 10:14 PM IST
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Synopsis
Subbarao noted that though governments and central banks of the world are presently operating from the playbook of the Global Financial Crisis in 2008-09, the coronavirus crisis is quite different. "While GFC was an asset crisis that hit the financial sector first, the coronavirus crisis first impacted the real sector," he pointed out. The former RBI Governor said there were certain key elements to the central bank's monetary policy response so far.
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Subbarao, however, opined that given the excessive liquidity in the system it could become a challenge to wind down liquidity going forward.