The Reserve Bank of India’s central board, on Friday, took stock of the current economic situation and the evolving challenges posed by the Covid-19 pandemic.

The meeting came in the backdrop of the domestic economic activity getting severely impacted by the pandemic-related lockdown.

“Among others, the Board also discussed the Reserve Bank’s activities during the period (July 2019-June 2020), the budget for the next accounting year July 2020 to March 2021 (aligned with the government’s financial year), and other policy and operational matters,” the RBI said in a statement.

It may be pertinent to note here that last month the monetary policy committee (MPC) of the RBI had observed that the macroeconomic impact of the pandemic is turning out to be more severe than initially anticipated, and various sectors of the economy are experiencing acute stress.

“The impact of the shock has been compounded by the interaction of supply disruptions and demand compression.

“Beyond the destruction of economic and financial activity, livelihood and health are severely affected,” the committee had then said.

Even as various measures initiated by the government and the RBI work to mitigate the adverse impact of the pandemic on the economy, the MPC emphasised that it is necessary to ease financial conditions further. This will facilitate the flow of funds at affordable rates and revive animal spirits.

The RBI top brass briefed the Board about the overall macroeconomic conditions ― both domestic and global; financial sector situation; and the impact of various monetary, regulatory and other measures taken by the RBI in the context of the Covid-19 pandemic.

Beside the RBI top brass ― Governor Shaktikanta Das and Deputy Governors BP Kanungo, MK Jain, and MD Patra, the other Directors of the Central Board ― N Chandrasekaran, Ashok Gulati, Manish Sabharwal, Prasanna Kumar Mohanty, Dilip S Shanghvi, Satish K Marathe, Revathy Iyer, and Sachin Chaturvedi, attended the meeting through video conference.

Tarun Bajaj, Secretary, Department of Economic Affairs, and Debasish Panda, Secretary, Department of Financial Services, also attended the meeting.

Published on June 26, 2020

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