Global Debt, AI Risks Among 5 Financial Stability Threats, Says RBI Governor Malhotra
- Reserve Bank of India Governor Sanjay Malhotra said India remains cautious about private cryptocurrencies while supporting their underlying technology and exploring central bank digital currencies for cross-border payments.
- Malhotra identified global debt, stretched artificial intelligence valuations, leverage in non-bank finance, private credit, and cyber threats as financial stability risks.
- He warned that weaker artificial intelligence investment or earnings could sharply reduce financial asset values and increase market volatility.
- Malhotra said future financial crises could begin outside the banking sector through geopolitical events, cyberattacks, or technological failures, while describing India’s financial system as resilient.
21 Articles
21 Articles
RBI remains cautious on crypto, backs underlying technology: Governor Malhotra
Governor Sanjay Malhotra says India supports innovation in distributed ledger technology and tokenisation, but is wary of cryptocurrencies over concerns about monetary sovereignty and capital flows
RBI remains cautious on crypto, backs underlying technology: Governor Sanjay Malhotra
India's cautious approach towards cryptocurrencies emphasises the importance of underlying technologies like distributed ledger and tokenisation. RBI Governor Sanjay Malhotra expressed concerns regarding monetary sovereignty and its effects on capital flows. While domestic payments are efficient, challenges remain in cross-border transactions, which may benefit from central bank digital currencies. The rising public debt and bond yield movements…
No sign of stress, but cost of allowing vulnerabilities to build ‘simply too high’, says RBI Governor
Speaking at the Kautilya Economic Conclave, Sanjay Malhotra called for vigilance as very prolonged periods of stability can encourage risk taking and fade memories of past crises.
AI investment boom supports markets, but slowdown could trigger sharp repricing: RBI Governor Malhotra
Malhotra said a correction in AI-related valuations in advanced economies could, however, have a positive spillover for emerging markets such as India through higher capital inflows.
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