Global growth poses risks to Indian economy, says RBI – Times of India

MUMBAI: India’s macroeconomic fundamentals remain strong, but emerging global developments pose downside risks in terms of spillovers. reserve Bank of India (RBI) said in its monthly bulletin on Thursday.
“The ongoing geopolitical crisis has added to the uncertainty in the global macroeconomic and financial landscape, even as the world economy struggles to recover from the pandemic,” the RBI wrote, adding that the uncertain economic The outlook has increased risks to emerging economies.
Even as India continues to make steady progress on the domestic front, rising oil and gas prices and volatile financial market conditions still present fresh headwinds for an incomplete global recovery, it has been observed.
The RBI also said that the rapid and massive withdrawal of fiscal support risks pushing the economy into a sharp recession.
“Exit policy makers have to grapple with razor edge trade-offs between cliffs and ramps,” RBI said.
Keeping this at a record level in the last central bank policy announcement in February, it has continued the accommodative stance and left the prime lending rate unchanged, despite rising inflation.
RBI once again highlighted the risks posed by virtual currencies and noted that crypto technology is based on the philosophy of avoiding government control and jeopardizing the financial sovereignty of a country and making it susceptible to strategic manipulation.
“They may (and most likely will) ruin the monetary system, the monetary authority, the banking system and the ability of the government in general to control the economy,” the RBI wrote.
Last month, the central bank issued a stern warning against investing in cryptocurrencies and compared it to Ponzi schemes, saying they should be banned.