Basel III LCR affects RBI monetary operations – paper
Liquidity coverage ratio affects the central bank’s operational target
The liquidity coverage ratio (LCR) contained within Basel III appears to have an impact on the Reserve Bank of India's (RBI) monetary operations, according to a working paper published on February 22.
Sitikantha Pattanaik and Rajesh Kavediya, of the RBI's monetary policy department, and Angshuman Hait, of the banking supervision department, warn that the LCR could pose "major complications" for monetary policy.
While most banks can comfortably meet the LCR, some that operate very close to the
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