The Reserve Bank of India Governor Shaktikanta Das is delivered an unscheduled speech which started at 10 AM today.
To ensure that financial conditions remain favorable and markets operate efficiently, the RBI is prepared to go to war. We will work closely with the government to mitigate the effects, the RBI said.
The Sensex rises 259 points, while the Nifty rises to 14,583 points. India has now surpassed the 2-crore mark in total Covid infections cases, putting it second only to the United States and ahead of Brazil globally.
RBI Governor Shaktikanta Das Speech Highlights:
- Until December 1, 2021, the RBI allows restricted KYC to be used.
- RBI announces 50000 cr liquidity for Covid related healthcare infrastructure till march 2022.
- Those who have availed earlier window of restructuring can be given additional 2 years of moratorium.
- Small finance banks are permitted to lend to microfinance institutions with assets of up to Rs 500 crore: Das
- The Reserve Bank of India has announced a targeted long-term repo operation of up to Rs 10,000 crore for small finance banks.
The money can be used to lend up to Rs 10 lakh to each borrower.
- Banks will be able to park excess liquidity with the RBI up to the amount of their Covid loan book, according to governor Shaktikanta Das.
- A Rs 50,000 crore on-tap liquidity window with a term of up to three years at repo rate will be open until March 31st, 2022: Shaktikanta Das.
- Banks may help organizations such as vaccine manufacturers, medical services, clinics, and patients under the scheme.
- The IMD's forecast of a normal monsoon in 2021-22 is expected to support rural demand and overall production while also easing inflationary pressures.
- Localized and targeted containment initiatives are allowing businesses and households to adapt; as a result, the impact on aggregate demand is expected to be moderate this year, according to Das.
- On May 20, the second purchase of government securities worth Rs 35,000 crore under G-SAP 1.0 will take place: Shaktikanta
- There will be no significant deviations from the forecasts in the RBI's April MPC.
- Businesses have learned to thrive despite Covid constraints and containments.
- According to Shaktikanta Das, a good monsoon forecast would keep rural demand high.
- The global economy's outlook is extremely unpredictable and vulnerable to downside risks, says Das.
- According to Das, aggregate supply conditions are bolstered by the agriculture sector's power.
- RBI Governor Guv Das says the RBI will continue to track the Covid-19 situation and will use all of its resources.
- Shaktikanta Das advises having confidence in India's ability to recover from the Covid-19 crisis.
It was expected that Das will announce relief measures such as an extension of the loan moratorium, a one-time loan restructuring, and so on. With loan holidays and cash injections, as well as interest rate cuts, the RBI has bolstered Modi's government's fiscal support steps.
Das expressed optimism about the overall COVID-19 situation following the vaccine rollout on March 3 and praised all SAARC central banks for their efforts in combating the pandemic, according to a statement released by the central bank on Tuesday.
RBI has promised to keep monetary policy loose, despite the fact that inflation fears have limited its options.