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26/11/2020 10:43am

Indian economy pick-up stronger than expected, says RBI Governor

image Indian economy pick-up stronger than expected, says RBI Governor

New Delhi, Nov 26 (KNN) Indian economy has shown stronger than expected pickup in recovery, said Reserve Bank of India Governor Shaktikanta Das on Thursday.

Speaking at the annual day event of Foreign Exchange Dealers' Association of India (FEDAI), Das said that even as the growth outlook has improved, downside risks to growth continue due to recent surge in infections in advanced economies and parts of India. 

“After witnessing a sharp contraction in the economy by 23.9 per cent in Q1 and a multi-speed normalisation of activity in Q2, the Indian economy has exhibited stronger than expected pick-up in momentum of recovery," Das added.

Indian economy contracted by 23.9 per cent in the first quarter of the fiscal year, and the RBI expects the economy to shrink by 9.5 per cent in FY21.

''We need to be watchful about the sustainability of demand after festivals and a possible reassessment of market expectations surrounding the vaccine. The monetary policy guidance in October emphasised the need to see through temporary inflation pressures and also maintain the accommodative stance at least during the current financial year and into the next financial year,'' he said.

He further said that regulatory reforms have moved the financial markets to the next trajectory amid the pandemic and affirmed RBI's commitment to ensure an orderly conduct in the markets.

''India will continue to approach capital account convertibility as a process, rather than as an event within a broad macroeconomic framework,'' he asserted.


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