Mumbai, Jun 17 (KNN) The Reserve Bank of India (RBI) on Thursday said that the speed and scale of vaccination will shape the path of economic recovery which has the resilience and the fundamentals to bounce back from the pandemic and unshackle itself from pre-existing cyclical and structural hindrances.

As per the current assessment, the second wave’s toll is mainly in terms of the hit to domestic demand, said the apex bank in a statement.

On the brighter side, several aspects of aggregate supply conditions - agriculture and contactless services are holding up, while industrial production and exports have surged compared to last year amidst pandemic protocols, it said.

The banker's bank further said that considering macroeconomic determinants of the yield curve, the study finds that the level of the yield curve has undergone a downward shift from the second quarter of 2019, reflecting the ultra-accommodative stance of monetary policy.

''The slope of the yield curve is found to have steepened with abundant liquidity depressing short-term interest rates more than proportionately alongside a pick-up in issuances of ultra-long dated paper. Out of sample forecasts indicate scope for moderation of longer-term yields from current levels,'' it added.

It further said that the Indian economy continues to wrestle with the second wave of the pandemic, though cautious optimism is returning.