Very calibrated, cautious plan needed for economy post-Covid: RBI Governor
Risk-management systems should be able to “smell vulnerabilities in businesses in advance, the RBI Governor said
Reserve Bank Of India (RBI) Governor Shaktikanta Das has emphasized on a cautious exit plan while tracking the prevailing situation due to COVID-19
While speaking at Unlock BFSI 2.0 on Thursday, he said that the central bank is working on resolutions and measures for longer interests and it will not unwind any measures immediately, according to a report by MoneyControl.
Pointing out that RBI’s response to COVID-19 was “unprecedented”, Das referred to the need for a “very calibrated and cautious plan” for the economy, the report said.
"The banking landscape has changed a lot in recent years. But overall, India’s banking sector continues to be sound and stable. Today, the banks need to look at sunrise sectors while supporting those sectors which have the potential to bounce back," Money Control quoted Shaktikanta Das saying.
He added that risk-management systems should be able to “smell vulnerabilities in businesses in advance”. As per the RBI Governor, "The coronavirus pandemic will put pressure on balance sheets of banks and lead to erosion of capital."
In response to the pandemic challenge by banks across the country, the RBI directed banks and NBFCs to do a COVID stress test.
Governor Das said that the central bank has not exhausted its ammunition on rate cuts or policy actions. He mentioned monetary policy stance will remain accommodative, the publication reported.
According to the report, he stated, "RBI does not have the luxury to give one number (estimate) today and change it a month down the line. Once there is some amount of clarity about the COVID-19 curve and other aspects around the pandemic, the RBI will certainly start giving the growth numbers."