RBI may have to monetise Rs 7 trn of stimulus, says Bank of America

Of the nearly 10% of GDP worth stimulus, 7.3 percentage points of it can be funded through many means, it said

The government may have to ask the RBI to monetise around Rs 6.8 trillion of the total economic package announced by Prime Minister Narendra Modi so as to complete the funding under the package, Bank of America Securities (BofA) said in a note on Thursday. 

“Of the nearly 10 per cent of GDP worth stimulus, 7.3 percentage points of it can be funded through many means. But the balance 2.7 percentage points or Rs 6.8 trillion of it will likely need to be monetised by the RBI,” BofA said.