Economy faces several risks to fiscal health: RBI

More about the App
The risks RBI highlighted includes :

1. Oil prices.
2. The uncertainty over the effect of the minimum support price (MSP) hike.
3. The revenue impact of the lower-than-expected GST collections and the cut in excise duty on fuel.

  • These risks could pose a challenge to the government’s commitment to meeting the Fiscal Responsibility and Budget Management targets.
  • The key downside risks to growth are:
    1.  High international commodity prices-especially of crude oil (There are still significant uncertainties).
    2.  Spillovers from tightening global financial conditions.
    3.  Geo-political tensions.
    4.  Trade wars.
    5.  Financial turbulence.
    6.  The overhang of impairment in domestic banking and corporate balance sheets.
  • The central bank added that the decline in the gross saving rate, mainly due to the decline in household gross financial savings, is another cause for concern.
  • Regarding inflation, the RBI said that the outlook calls for a “close vigil” over the next few months as several upside risks persist.
Source
The Hindu.





Posted by Jawwad Kazi on 28th Nov 2018
<< Previous Next >>