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As the severe Covid crisis and the resultant lockdowns have shut down economic activities to a great extent, the monthly RBI Bulletin has said that demand and employment have been among the most impacted economic aspects amid the second Covid wave.

The RBI Bulletin for May 2021 noted that the real economy indicators moderated through April-May 2021.

"The biggest toll of the second wave is in terms of a demand shock - loss of mobility, discretionary spending and employment, besides inventory accumulation, while the aggregate supply is less impacted," it said.

It, however, said that the resurgence of Covid-19 has dented, but not debilitated economic activity in the first half of Q1 2021-22. Although extremely tentative at this stage, the central tendency of available diagnosis is that the loss of momentum is not as severe as at this time a year ago, it added.

On the NBFC segment, the report said that the consolidated balance sheet of NBFCs grew at a slower pace in Q2 and Q3 2020-21. However, NBFCs were able to continue credit intermediation, albeit at a lower rate, reflecting the resilience of the sector.

The Reserve Bank and the government undertook various liquidity augmenting measures to tackle Covid-19 disruptions, which facilitated favourable market conditions as indicated by the pick-up in debenture issuances.