Global outlook more uncertain: Reddy

Y V Reddy, Governor, Reserve Bank of India, today said that though global financial uncertainties were not entirely unanticipated, the intensity and duration of the global crisis was neither predicted nor expected.

"The global outlook is far more uncertain now than before," Reddy said while speaking to reporters on the sidelines of a function here today.

The Reserve Bank will, in its monetary policy review on January 29, take into consideration the possible slowdown in the US economy and the global financial turmoil emanating from the US subprime mortgage crisis. "I think we will pay considerable attention to that subject, and the monetary policy statement will take note of it," he said.

Reddy said the central bank would continue to be sensitive to high crude and food prices. "These are essential commodities that have great impact on inflationary expectations," Reddy added.

High food and crude oil prices globally were, in a way, anticipated and "the pressures have been flat," he said.

On liquidity, Reddy said it had been volatile in the past, and one has to "take a long-term view and not a contextual view."