US downgrade has caused ‘some turbulence’

By | June 20, 2011

A recent press report said that the immediate impact on the US rating downgrade on India is not that damaging. Dr.Subir Gokarn, Deputy Governor, RBI told that the RBIs commitment is to ensure that a disruption does not take place.

The impact of the downgrade so far has largely been on the financial institutions, banks, commodity prices and according to him the US rating downgrade caused “some turbulence”.  However the real concern is deeper as per the report.

Further Mr.Subir said that there is an increasing negative dynamics in the US and the growth outlook for the US, the UK, France and Germany has been lowered significantly in the past few days. All of these add up to a pessimistic global scenario.

Subsequently he said that, there is a significant change in the environment and the US stance can maintain current reserves till 2013 will keep commodity prices up which is a problem for India and that’s where India’s possible links lie.

As per the report, on the impact of the global scenario on investment, Dr.Subir said that as long as India sustains the growth trajectory it might well work in favour of the emerging markets. Further it comes down to how well India can manage our macroeconomic conditions.

The recent hike in base rates by the RBI has made banks loans (home loan, personal loan, vehicle loan, business loans etc,) very costly.

All information including news articles and blogs published on this website are strictly for general information purpose only. BankBazaar does not provide any warranty about the authenticity and accuracy of such information. BankBazaar will not be held responsible for any loss and/or damage that arises or is incurred by use of such information. Rates and offers as may be applicable at the time of applying for a product may vary from that mentioned above. Please visit for the latest rates/offers.
Category: Articles Glossary Tags: , ,

About Pradeep Yuvaraj

Pradeep Yuvaraj is a Co-Founder and Director at Finerva Financial Solutions Private Limited, a financial education company focused on personal finance education. He has penned over 250 articles relating to Personal Finance and clocked over 500 hours of educating individuals on managing personal finance. He is a serial entrepreneur and has been associated with 7 Start-ups. His entrepreneurial experience spans industries as varied as Education, Gas Engineering, Automobile Design, Software development and more recently a Pure play presentation design company. Prior to turning entrepreneur in 2005, he has worked for 3 of the top ten companies of the world - Shell, ExxonMobil and Total SA. This experience included handling Branch Operations, Channel Sales and Business Development across 5 states over a period of 8 years. He holds an MBA from Symbiosis and an Electronics Engineering Degree from the University of Pune.

Leave a Reply

Your email address will not be published. Required fields are marked *