Millennium Post

Brexit: RBI says keeping 'close vigil' on developments

As stocks and rupee plunged sharply amid uncertainties ahead of 'Brexit' referendum tomorrow, RBI today said it is keeping a "close vigil" on developments and will take all necessary steps including liquidity support to ensure orderly conditions in the financial markets.

"In the run up to the referendum in the United Kingdom on its continuing in the European Union (Brexit), uncertainty about the poll outcome has resulted in some amount of turbulence in global financial markets, including in India," the Reserve Bank said in a statement.

"The RBI is maintaining a close vigil on developments, and will take all necessary steps, including liquidity support, to ensure orderly conditions in financial markets," it said.

The UK will vote tomorrow on whether to remain in the 28-nation European Union or to leave. Britain's exit from the EU, or Brexit, is being debated globally as it could have implications for the international financial markets and exchange rates.

India has significant trade with the UK as well as the EU. It also receives large investments from the Europe.

The stock market benchmark Sensex plunged nearly 150 points in early afternoon trade amid Brexit uncertainties, while rupee was also down in morning trade on these concerns.

Yesterday, Federal Reserve Chair Janet Yellen said Britain's exit from the European Union would have a significant economic repercussions.

"One development that could shift investors sentiment is the upcoming referendum in the United Kingdom. A UK vote to exit the European Union could have significant economic repercussions," the US Federal Reserve Board Chairwoman Janet L Yellen had said.
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