Indian economy expected to recover despite global uncertainty: RBI

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Despite the grim outlook on the global front, the Reserve Bank of India (RBI) is positive that the Indian economy will make it through even as inflationary pressures, external spillovers, and geopolitical risks make careful handling and close monitoring necessary. A gradual but uneven recovery in the first quarter of 2022-23 is expected when looking at high-frequency indicators.

Rising commodity prices, supply chain disruptions, and negative growth prospects along with the war in Ukraine are all causes for worry for the global economy, according to the 25th issue of Financial Stability Report (FSR) released by the RBI. The FSR is the overall assessment of financial stability risks and the resilience of the financial system conducted by the Sub-Committee of the Financial Stability and Development Council (FSDC).

Despite the grim outlook on the global front, the RBI is positive that the Indian economy will make it through even as inflationary pressures, external spillovers, and geopolitical risks make careful handling and close monitoring necessary. A gradual but uneven recovery in the first quarter of 2022-23 is expected when looking at high-frequency indicators.

On the contrary, the Indian market leaves space for optimism. “While corporate sales and profitability have risen, a durable commencement of the capex cycle remains elusive. Bank credit growth is picking up steadily, already clocking double digits. Banks have also bolstered capital and liquidity positions while asset quality has improved. Non-banking financial companies (NBFCs) remain well capitalised,” as per the FSR.

Fibre2Fashion News Desk (NB)





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