RBI, Govt to face liquidity crunch as commercial papers worth Rs 1.52L crore are set to mature
Liquidity is a critical indicator of banking, financial services and insurance (BFSI) sector’s performance over the next few months. The current tightness in liquidity and systemic risk aversion, triggered by IL&FS’s default, and outflows from debt mutual funds, have big implications for non-banking financial companies (NBFCs), which will be in a deep soup if they are unable to properly anticipate funding supply challenges, said market experts.
A bigger concern lately has been the liquidity shortage in the NBFC sector on rising markets-based borrowing costs and liquidity in the system moving from benign to tight.Image source: Reuters