RBI Financial Stability Report June 2024

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Questions and Answers

What does the Financial Stability Report (FSR) primarily assess?

  • Performance of financial institutions
  • Macro-financial policies
  • Risk to financial stability and system resilience (correct)
  • Global market trends

Which body collectively assesses the inputs for the Financial Stability Report (FSR)?

  • Economic Affairs Committee
  • Financial Sector Development Board
  • Reserve Bank of India
  • Sub-Committee of the Financial Stability and Development Council (correct)

Which of the following chapters is NOT included in the Financial Stability Report (FSR)?

  • Investment and Portfolio Management (correct)
  • Financial Institutions: Soundness and Resilience
  • Regulatory Initiatives in the Financial Sector
  • Macro-financial risks

How often is the Financial Stability Report (FSR) published?

<p>Bi-annually (D)</p> Signup and view all the answers

What additional component does the Financial Stability Report (FSR) include besides the three chapters?

<p>Systemic Risk Survey (A)</p> Signup and view all the answers

By end-2023, what was the percentage of global public debt relative to GDP?

<p>93.2% (C)</p> Signup and view all the answers

What was the global debt in US dollars by the end of 2023?

<p>US$ 251.4 trillion (A)</p> Signup and view all the answers

What was the primary factor contributing to the increase in global public debt post-pandemic?

<p>Expansionary fiscal policies (A)</p> Signup and view all the answers

Which factor is NOT mentioned as contributing to heightened risks in the global economy?

<p>Rising unemployment rates (A)</p> Signup and view all the answers

According to the IMF, what is the forecasted global growth rate for 2024?

<p>3.2% (A)</p> Signup and view all the answers

Which two countries are leading the increase in global debt?

<p>U.S. and China (C)</p> Signup and view all the answers

What is the main focus of monetary policy authorities worldwide?

<p>Bringing inflation down to targets (A)</p> Signup and view all the answers

What percentage of GDP did global private debt amount to by end-2023?

<p>239.9% (A)</p> Signup and view all the answers

Which organization predicted a 2.6% global growth rate for 2023?

<p>World Bank (D)</p> Signup and view all the answers

Which of the following is a challenge mentioned in bringing inflation down to targets?

<p>Sticky services inflation (A)</p> Signup and view all the answers

What is the forecasted growth rate for Advanced Economies (AES) in 2025 according to the World Bank?

<p>1.7% (A)</p> Signup and view all the answers

What was the real GDP growth rate for India in 2022-23?

<p>7.0% (C)</p> Signup and view all the answers

What is India's expected contribution to global growth in 2023-24?

<p>18.5% (A)</p> Signup and view all the answers

Which factor did NOT act as a drag on India's GDP growth in 2023-24?

<p>Increasing foreign investment (B)</p> Signup and view all the answers

What is the projected real GDP growth for India in 2024-25 according to the MPC?

<p>7.2% (D)</p> Signup and view all the answers

Despite which conditions did India achieve an 8.2% real GDP growth in 2023-24?

<p>Muted private and government final consumption (C)</p> Signup and view all the answers

By the end of 2023, what percentage of GDP did global public debt reach?

<p>93.2% (B)</p> Signup and view all the answers

Which two countries are leading the increase in global debt?

<p>U.S. and China (D)</p> Signup and view all the answers

What was the global fiscal deficit as a percentage of GDP on average in 2023?

<p>5.5% (B)</p> Signup and view all the answers

What was the global private debt in US$ trillion as at end-2023?

<p>$153.7 trillion (C)</p> Signup and view all the answers

What was the global debt as a percentage of GDP, including both public and private debt, by end-2023?

<p>239.9% (A)</p> Signup and view all the answers

To what extent did the primary deficit decrease on average in advanced and emerging market economies?

<p>2 percentage points of GDP (B)</p> Signup and view all the answers

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Study Notes

Financial Stability Report

  • The Financial Stability Report (FSR) is a half-yearly publication that reflects the collective assessment of the Sub-Committee of the Financial Stability and Development Council (FSDC) with inputs from all financial sector regulators.
  • The FSR consists of 3 chapters and a Systemic Risk Survey (SRS).

Global Economy

  • The global economy faces heightened risks from prolonged geopolitical tensions, elevated public debt, and slow progress in disinflation.
  • Despite challenges, the global financial system remains resilient, and financial conditions are stable.
  • Global growth forecasts:
    • IMF: 3.2% (2023), 3.2% (2024), 3.2% (2025)
    • World Bank: 2.6% (2023), 2.6% (2024), 2.7% (2025)

Global Debt

  • Global public debt has increased to 93.2% of GDP by end-2023, nine percentage points above its pre-pandemic level.
  • The two largest economies, the U.S. and China, are leading the increase in global debt.
  • Private debt also remains elevated, with global debt standing at 239.9% of GDP as at end-2023.
  • The threat of a looming debt crisis cannot be overemphasized.

Domestic Economy

  • The Indian economy is exhibiting resilience and remains the fastest growing major economy.
  • India's contribution to global growth is rising and currently stands at 18.5% in 2023-24.
  • Real GDP rose by 8.2% in 2023-24, up from 7.0% in the previous year.
  • The Monetary Policy Committee (MPC) has projected real GDP to grow by 7.2% during 2024-25.

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