RBI meets with credit rating agencies to gather opinions on economic downturn due to Covid-19 pandemic

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Reserve Bank of India Governor Shaktikanta Das held a meeting with heads of credit rating agencies on Thursday to discuss the macroeconomic situation and outlook for various sectors of the economy. The meeting, via videoconference, brought together deputy governors and other senior central bank officials.

It came a day after Standard and Poor’s affirmed its rating on India’s long-term foreign and local currency sovereign credit at lowest investment grade, but maintained a stable outlook on the economy. . India’s long-term rating was affirmed at BBB-minus with a stable outlook while the short-term rating was maintained at A3.

On June 1, Moody’s lowered the ratings of long-term foreign and local currency government issuers from Baa3 to Baa2. He said the coronavirus outbreak has amplified existing vulnerabilities in India’s credit quality. RBI officials collected the assessment of credit rating agencies on the macroeconomic situation and outlook of various sectors of the economy, including the financial sector.

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They also listened to the outlook on the overall financial health of entities rated by credit rating agencies, the RBI said in a statement. Officials also discussed key factors affecting credit ratings in the current environment, as well as ways to further strengthen ratings processes and engagement with key stakeholders.

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