RBI Monthly Bulletin – Issued On November 2022

Muskan Agrawal

28 Nov, 2022

The reserve bank of India on 18 November released the monthly bulletin for November 2022. The RBI monthly bulletin includes five speeches, eight articles and current statistics.

The data centres for banks and financial institutions are very important for their impact on the environment and the benefits of green data centres.

Exploring news as a potentially rich source of information and leveraging upon Big Data techniques. Discuss macroeconomic variables and examines their utility for economic analysis in the Indian context.

This article discusses the five articles related to the Indian economy, Digitalisation, Indicators of the economy and investigation.

State of the economy

The global economy still has a considerable risk involved. Global financial condition is not good and has been tightening and worsening market liquidity, increasing financial movements of the price. The market policy rate increases and risk is on the higher side. In India, supply in the economy has become more vigorous. With headline inflation beginning to show signs of easing, the domestic macroeconomic viewpoint can best be featured as resilient but sensitive to terrifying global headwinds. Urban demand is robust, and rural demand is muted but recently gaining traction.

When a News Story is More Than Just Text: Evidence from the Indian Economy

• The news story covers the changing pattern in different sectors of the economy. The anticipated ability of sentiment in a forecasting framework, the value sentimental which is derived from news enhanced with the help of the statistical and machine learning methods.
• The sentiment is depressed due to the COVID-19 pandemic. Sentiments recovered with the gradual resumption of economic activities and a return towards normalcy.
• A high-frequency sentiment index can be a useful complementary indicator to provide early signals on economic conditions.

Green Data Centres: Pathway to Sustainable Digitalisation

• With a growing importance on digitalisation, the need for data centres in the country has increased manifold. As part of their operations, data centres consume a lot of power, thereby contributing to greenhouse gas emissions.
• Due to a favourable geographical location and conducive government policies due to this, India’s data centre industry is in a high growth stage. It is better placed to adopt green technologies for both the existing and upcoming data centres.
• The article provides suggestions to help banks and financial institutions in green data centres, such as acquiring industry-accepted approval from Indian Green Building Council (IGBC) and Leadership in Energy & Environmental Design (LEED) certification. It replaces outdated or inefficient information technology equipment; it integrates green measures in data centre operations, including in their design, materials, construction, energy consumption and waste management.

Payment Flows as Economic Indicators: Now casting Using a Hybrid Machine Learning Framework

• The payment process is an essential aspect of financial intermediation. Efficient payments and settlement systems can act as ammunition for economic momentum. In this context, the study evaluates the use of payments data to nowcast growth in gross value added^[1] (GVA).
• The mixed frequency data has been applied to a framework of hybrid machine learning. The study uses a combination of Mixed Data Sampling (MIDAS) and Support Vector Machine (SVM) models.
• A disaggregated approach is employed to misuse the details available from individual payment indicators. Additionally, both volume and value channels are explored.
• Anticipated accuracy improves substantially for the nowcasts generated using the hybrid approach.

Transmission of Financial Conditions to Fixed Investment in India: An Empirical Investigation

RBI monthly bulletin includes the financial condition indices constructs with the help of the Dynamic factor model (DFM) and vector autoregression (VAR) approach. In addition, the effect of the financial situation on investment growth in India and the uneven relationship is empirically examined to measure the risks to investors.

• Financial conditions affect investment with a lag, and expectations about future demand significantly drive investment growth.
• The impact is uneven, with tighter financial conditions significantly affecting investment growth when the investment cycle is weakened.

Conclusion

The RBI monthly bulletin issued, where five primary articles are described, such as the state of the economy when a new story is more than just text: Evidence from Indian economy, Green data centres: Pathway to sustainable digitalisation, payment flows as economic indicators: Nowcasting using a hybrid machine learning framework, condition to fixed investment in India: An empirical investigation.

The points mentioned earlier highlight the different factors that impact the economy more. One of them is global financial condition is not in good condition, and the market condition is worsening day by day; another factor is a potential source of information which captures the changing patterns in various sectors of the economy. Apart from this, the article discusses the impact of banks and financial institutions on the economy and green data centres.

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