The current Indian outlook on Indian money markets is extremely uncertain: the Reserve Bank

New delhi date. 9 April 2020, Thursday

The Reserve Bank of India (RBI) has said that the outlook for domestic money markets is quite uncertain given the huge outflows of capital from the country's money markets.

The sharp decline in global prices of cod oil, the rise in the number of coronary patients in India, the burden on the banking sector due to the stress on the private sector bank and the boom in the global economy have created a downturn in the Indian stock market, the Reserve Bank said in its April report. General Chat Chat Lounge

Due to low oil prices, high GST tariffs, industrial production growth and high PMI in the manufacturing sector in December, the country's stock markets remained bullish until mid-January. The Sensex closed at a record high of 9 January.

As investors across the globe are avoiding risk taking, equity markets, including India, have been heavily traded, RBI reports.

The BSE Sensex has declined by 5% since January 1. In the case of bonds, the yield was weak in early March. The weakness was attributed to the sudden drop in lending rates by the American federal and the fall in cod oil prices.

The country's money markets are dominated by global events, the Reserve Bank reported. Apart from this, weak economic growth rate in India and the rise of Covid-1 have destabilized the money markets.

Rupee is being forced on account of capital outflows. During the September-March period, the rupee has depreciated by more than 5 percent against the dollar. Good transmission of monetary policy will continue to be a priority for the credit market, the report also noted.