Mumbai: The Reserve Bank today said a slew of factors, including its own policy of monetary tightening and "perceived governance issues" are impacting investments, "Indications are that investment demand is softening as a result of a combination of factors, including monetary tightening, hindrances to project execution and deteriorating business confidence," the central bank said in its Macroeconomic and Monetary Developments Report released on the eve of mid-year policy announcement. The business confidence has been dented by an array of factors, including "the perceived governance issues". A slowdown in both the domestic as well as global economies and the impact of volatile equity markets on wealth are having an ill-effect on investments, it maintained. Further, it warned of a greater impact of the slowdown, saying, "...the pipeline of investment is likely to shrink, putting 2012-13 growth at risk." "Information from the corporate sector, the banking system''s capex funding, housing transactions as well as falling construction activities suggest that investment has been adversely impacted," the report said. Data collected from 33 major lenders indicate a sharp decline in investment intentions during the April-June quarter, RBI said. During the first three months of FY 2012, only 135 projects were sanctioned funding assistance, amounting to Rs 80,300 crore, as against 195 projects and Rs 1,42,800 crore in the corresponding quarter previous fiscal, it said. Defending its tough anti-inflationary stance, which has seen 12 straight hikes in the last 19 months, the report said though the softening was anticipated, a combination of "non-monetary factors" has aggravated the investment climate.