RBI: Global uncertainities higher than estimates

Y V Reddy, Governor of Reserve Bank of India (RBI), today said global economic uncertainities had surpassed earlier estimates, but maintained that the central bank would stick to the "basic projections" till the review of the monetary policy.

"As far as the outlook on the economy is concerned, a formal response will come during the monetary policy review (later this month). As of now, we are sticking to the basic projections, but global uncertainities have certainly increased than what we estimated," Reddy said after the meeting of the central board of directors of RBI in the city today.

He added that the central bank was analysing the situation at this stage, and hoped to come out with an update on the economy and policy at the quarterly review at the end of the month.

Reddy said RBI was taking all steps to ensure stability of the markets. "For liquidity management, the size of market stabilisation scheme (MSS) and the size of liquidity adjustment facility (LAF) have to be consistent with liquidity management that is appropriate to maintain stability. Therefore, you would find that the emphasis is on stability," he said.