INSUBCONTINENT EXCLUSIVE:
Shaktikanta Das, RBI Governor (Photo: Shutterstock)3 min read Last Updated : Sep 13 2024 | 11:46 PM IST
Banks could be a target for short
sellers as stress in the global commercial real estate sector can cause liquidity squeezes, Reserve Bank of India Governor Shaktikanta Das
cautioned on Monday.
Delivering a speech at the Future of Finance Forum 2024 organised by the Bretton Woods Committee, Singapore, Das said
unexpected CRE losses, due to the relatively high CRE coverage ratios in their loan books
Further, liquidity squeezes can materialise for banks with large CRE exposures, as short sellers may target them and investor confidence may
alert and undertake forward-looking regulatory measures ahead of the curve to contain the risks to bank balance sheets and systemic
stability.
According to the International Monetary Fund, CRE prices fell by 12 per cent globally in real terms over the past year, with
the sector also remaining vulnerable to higher vacancy rates and rising financing costs.
In India, bank lending to the commercial real
estate sector was 22.8 per cent as on June 28, 2024, to Rs 4.21 trillion
This was higher than non-food credit, which grew by 13.9 per cent
The figures exclude the impact of the merger of HDFC with HDFC Bank, which came into effect from July 1, 2023.
Commenting on inflation in
moderated from its peak of 7.8 per cent in April 2022 into the tolerance band of +/- 2 per cent around the target of 4 per cent, but we
to 3.65 per cent in August from a revised 3.6 per cent in July, data released on Thursday showed, as a favourable base from the previous
year helped keep prices under check despite a mild uptick in food inflation
projections indicate that inflation is likely to ease further from 5.4 per cent in 2023-24 to 4.5 per cent in 2024-25 and 4.1 per cent in
The next policy review meeting is scheduled for October 7-9.
Das said the Indian economy rebounded from the severe contraction imposed by
the COVID-19 pandemic and averaged real GDP growth of above 8 per cent during 2021-24.
For 2024-25, the Reserve Bank of India (RBI)
the growth trajectory is supported by an environment of macroeconomic and financial stability.First Published: Sep 13 2024 | 8:07 PMIST
