Addressing the FICCI National Executive Committee Meeting, Reserve Bank of India Governor Shaktikanta Das on September 16 assured that the RBI is closely monitoring economic situation, and the central bank is prepared to take further measures to prepare the economy and banking system to fight the Covid-19 pandemic.
He acknowledged that the economic recovery remains slow and will be gradual. The uptick noticed in some sectors in the economy in the June-July period seems to have levelled off. High frequency indicators of agricultural activity, purchasing managers' index (PMI) for manufacturing and private estimates point to some stabilisation of economic activity in Q2.
Further, bank credit growth remains muted in the system. He hoped that the revival of businesses (due to moratorium or restructuring) will help keep NPAs low.
These reassuring statements helped the Nifty to rise towards the recent highs.