Countercyclical capital buffer not needed in the present circumstances, says RBI

The Reserve Bank of India, in its review of requirement of counter-cyclical capital buffer on Tuesday said it has decided against activating countercyclical capital buffer (CCyB) as it is not needed in the present circumstances. The framework on CCyB was put in place by the Reserve Bank of India (RBI) in terms of guidelines in February 2015, wherein, it was advised that the CCyB would be activated as and when the circumstances warranted and that the decision would normally be pre-announced. The framework envisages the credit-to-GDP gap as the main indicator, which may be used in conjunction with other supplementary indicators.

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