RBI Governor Das to Make Unscheduled Speech Wednesday
RBI Governor Shaktikanta Das sits for a press conference at the RBI headquarters in Mumai. (Photo: PTI)

RBI Governor Das to Make Unscheduled Speech Wednesday

Reserve Bank of India said Governor Shaktikanta Das will make an unscheduled speech on Wednesday as a ferocious new coronavirus wave devastates the country.

The address will be broadcast at 10 a.m. local time, the RBI said on Twitter, without providing further details.

Das has been meeting with bankers and shadow lenders since last month to discuss topics including the current economic situation, potential stress to balance sheets, credit flows and liquidity. CNBC reported Tuesday that bankers have requested relief, including payment moratoriums, citing banking sources.

The Covid-19 wave that has slammed India in recent weeks will probably worsen before it starts to taper off sometime later this month, forecasters warn. Pressure from industry groups has started mounting on Prime Minister Narendra Modi to impose lockdowns across the country to stem its spread, a move he has so far resisted to avoid the economic damage suffered last year.

Indian banks have seen a surge in problem loans in recent earnings after lenders were allowed to resume classifying bad debt following the reversal of a top court ruling in March. The second coronavirus wave could add to pressure on loan repayments as extended lockdowns in some parts of the country hurt businesses and jobs.

Loan growth also slumped to a several decade low of 5.6% in the financial year that ended in March.

The RBI has increased fiscal support measures from Modi’s government with loan holidays and cash injections, as well as interest rate cuts. The central bank has pledged to keep monetary policy loose though its room to act has been constrained by inflation concerns.

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