Omicron a flash flood, not a wave, economic recovery remains strong: RBI

Infection surge due to Omicron has dented recovery only temporarily

The Omicron-led third wave of Covid-19 may turn out to be “more of a flash flood than a wave”, and the Indian economy could rebound to pre-pandemic levels, according to the Reserve Bank of India’s (RBI’s) State of the Economy report released on Monday.

The report, part of the RBI’s January bulletin, said: “The overall economic activity in India remains strong, with upbeat consumer and business confidence and upticks in several incoming high-frequency indicators.”

However, the infection surge due to Omicron has dented the recovery to a large extent, albeit temporarily. “The recovery that has been underway in the Indian economy with