Challenges and Effects of Demonetization

Saturday, November 12 Leave a Comment

In presentation by Anand Rathi Securities group on the challenges and effects of demonetization, and am summarizing the points below for your benefit:

1. Immediate impact: is expected to be negative all round:

a. In the short term it will be a logistical nightmare to manage the cash replacement in banks and smooth functioning of the banking system
b. slowdown in consumer spending due to limited cash availability
c. severe liquidity issues in cash based sectors like Real Estate and Jewellery
d. GDP will decline in the next 2 quarters

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