New Delhi: The upheaval in domestic markets that followed the US economic downgrade notwithstanding, RBI on Thursday said the liquidity in the Indian banking system was not under stress and the central bank was monitoring the situation closely.

"We monitored the situation very closely since Monday and we have not seen any stress at this point. The quantum of liquidity is quite within range..," RBI Deputy Governor Subir Gokarn told reporters at a CII event here.

Rating agency S&P had on last Friday downgraded the US sovereign rating to AA+, from AAA.

Following that the RBI on Monday issued a circular saying that it was taking steps to ensure steady flow of rupee and dollar liquidity in the system to check volatility in the
forex market.

The stock fell nearly 3 per cent in two days of volatile trading and Rupee weakened to below 45 to a dollar.

Gokarn said the inter-bank lending rates or call rates and other money market or market repo rates "have been very stable".

He said over the last few days, the RBI has been monitoring the Rupee-Dollar movement and emphasised on ensuring steady supply of liquidity into the banking segment.

Gokarn, however, said that for RBI to assess the longer term impact of US downgrade on India would take some time. The deputy RBI governor said the global happenings will have its impact on the domestic economic growth and the central bank will analyse the situation when it reviews its quarterly monetary policy next.

 "But it is too early to comment on it," Gokaran added.

He said that the RBI would not immediately alter its 8 per cent economic growth projections for 2011-12.

"We are not instantaneously changing our projection, If there is any long term impact, that we will state in quarterly review of monetary policy," Gokaran said.

Anticipating  that investors might go in for re- allocation of portfolios in response to the downgrade by S&P, the RBI had earlier this week come out with a circular for foreign exchange market saying that the rupee liquidity was being provided through the repo window of the Liquidity Adjustment Facility (LAF).