Ready to take action for smooth functioning of markets: RBI on Coronavirus

The apex bank says it is closely monitoring global and domestic developments continuously

In the wake of the volatility in the financial markets due to COVID-19, the Reserve Bank of India today said that it is ready to take appropriate action to ensure orderly functioning of financial market, maintain confidence and preserve financial stability. The apex bank added that it is closely monitoring global and domestic developments continuously.

Globally, financial markets have been quite volatile, with the spread of coronavirus triggering risk-off sentiments and flight to safe havens. The spillover to the financial markets in India has largely been contained, RBI said in its statement.  

Growing hopes of coordinated policy action to mitigate broader fallout to economic activity has boosted market sentiment today, RBI added. The outbreak of coronavirus and subsequent spread to geographies across the world has adversely affected financial markets.

The rebound in domestic markets on Monday, which had shed 7 per cent in the past six sessions, came to a halt after the health ministry reported two new coronavirus cases on Monday. Besides, an Italian tourist also tested positive in Jaipur, according to the Rajasthan government.

The BSE Sensex was up almost 400 points, or 1.04 per cent, on global market cues. The rupee was trading at 73.16 to the dollar, after its previous close of 73.1.

Meanwhile, the government has issued a travel advisory, suspending all regular visas and e-visas granted on or before March 3 to nationals of Italy, Iran, South Korea, Japan who have not yet entered India, a day after two fresh cases of coronavirus were reported in the country.