RBI s liquidity, growth supporting measures crucial for recovery from 2nd COVID wave: Experts
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Last Updated: Jun 04, 2021, 05:27 PM IST
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Financial intelligence company Moody s Analytics said with COVID-induced restrictions likely to be eased only gradually, the sharp slowdown in domestic demand is set to weaken revival beyond the June quarter.
RBI in its monetary policy on Friday kept interest rates unchanged at record lows and committed to maintaining an accommodative policy stance to support growth.
The measures announced by RBI to maintain liquidity and support economic growth through lower interest rates will be crucial for recovery from the second wave of the COVID-19 pandemic, experts said on Friday. The RBI in its monetary policy on Friday kept interest rates unchanged at record lows and committed to maintaining an accommodative policy stance to support growth.
The MPC decisions were in line with expectations. An ET poll showed that there would be a status quo on rates and stance and a possibility of reduction in growth projections.
The government should understand that it is the prime mover. RBIs liquidity measures, expansive and innovative as they have been, have only served to increase the volumes of cash the banks have been depositing with the RBI under reverse repo.
Indian exports fell by 7.2 per cent in value terms in FY21, as the world wrestled with the COVID pandemic which had a severe impact to consumption because of the lockdowns and consequently to global trade. The exports had surged by more than 60 per cent in March to USD 34.45 billion as against USD 21.49 billion in the year-ago period.