India, Feb. 21 -- The Reserve Bank of India is examining proposed models for 'predictive' analysis of the markets, particularly the use of artificial intelligence and machine learning.

According to a report by the Economic Times, the central bank will leverage AI and ML models to detect early signs of asset bubbles, and market disruptions by analysing patterns from historical data, macroeconomic data and market behaviour.

Besides, AI and ML tools are likely to help the regulator in 'stress testing' of banks, ensuring that banks have enough capital to absorb shocks from downturn in economy and decline in markets.

Citing sources, the report further said that the RBI is rejigging its standing committee of analytics and amended the terms o...