RBI Governor Shaktikanta Das: RBI Announces Rs 1.2-Lakh-Crore GSAP 2.0, Says 6% Bond Yield Not Sacrosanct
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Public Debt Burden
The combined public debt of the Centre and states will reach around 90% of the GDP by March 2022, RBI Deputy Governor Michael Patra said.
However, the economic growth will continue to be higher than interest rate that the government pays on debt, Patra added. “Since that condition is fulfilled, RBI assesses that the public debt of India remains sustainable.”
No Change In RBI Stance On Cryptocurrencies
There is no change in the Reserve Bank of India’s position on cryptocurrencies, RBI Governor Shaktikanta Das said.
The central bank was, however "surprised” that some banks were still citing the 2018 circular that the Supreme Court set aside.
"We have major concerns around cryptocurrencies which we have conveyed to the government,” Das said. “Each investor should take careful and prudent call on their investments.”
RBI Governor On Loan Demand & Rising Stress
- Haven’t asked banks to push credit, cannot do it as a regulator.
- Reviewed credit flow and demand situation as per banks' assessments.
- Advised banks to implement resolution framework as soon as possible.
- Can't make exact prediction on when demand situation will turn.
- Estimating that from Q2 onward, demand situation will improve.
- Advised banks and NBFCs to push up capital buffers.
- Expect NPAs will remain within our past estimates, will be manageable.
RBI's Focus Is On Growth, Says Governor Das
- RBI monitoring growth revival, how it is taking roots.
- Also monitoring inflation dynamics.
- As it looks today, the focus is on growth.
- Inflation projection well within MPC’s target band.
- Focus on growth will continue.
'Inflation Not Persistent'
The Monetary Policy Committee’s view is that inflation is not persistent, it will become so when it is backed by demand-pull, RBI Deputy Governor Michael Patra said.
- No demand pull in inflation formation, mostly on the supply-side.
- Hence, MPC chose to look through inflation prints.