While balancing the growth-inflation trade-off to mitigate the effect of the COVID-19 pandemic, the RBI Monetary Policy Committee’s decision to continue with the accommodative policy position as long as required’ is reassuring to the business and commerce. This decision would also secure immense assistance from many other crucial measures declared by the central bank, stated ASSOCHAM Secretary-General Deepak Sood said.
As for inflation, we now discuss the RBI’s test that the current softening of these crude petroleum prices can assuage the enter cost pressure. What stands out from RBI’s credit rating is that despite a recent surge in coronavirus instances, the prognosis for its double-digit growth for FY’22 remains intact as the market is fast learning to live together with the health challenge. In addition, the large-scale roll-out of the vaccination program can also be encouraging the current market, explained Sood.
It can be reflected in the marketplace holding ground whatever the gain in pandemic cases. The confidence stems from a nation better prepared to look after the challenge of health infrastructure.
The ASSOCHAM Secretary General particularly noticed that the activities supplied by RBI Governor Shaktikanta Das to make sure domestic financial stability in the wake of volatility in the world financial markets, as was observed from the rising bond returns.
The actions announced by RBI through G-SAP operations are rather innovative to deliver stability in the yield curve.
The growth of forbearances concerning NBFCs and allowing entities besides banks such as payment systems to use facilities such as RTGS and NEFT would extend the financial inclusion, which the Financial Inclusion Index would additionally quantify. Moreover, comfort at the railroad of ECB proceeds would offer flexibility to corporates increasing resources from the worldwide markets.
Sood said RBI Governor’s assertion that it wouldn’t tighten the liquidity and must come as a pledge to the financial marketplace participants that saw some volatility in the face of increasing US bond returns.