Good things come in small bites and they come often, the Reserve Bank of India (RBI) says.
The central bank announced on Tuesday that it would make eight, not four, policy statements a year. It will be interesting to see what effect this change has on the economy.
Earlier, market participants had to digest four large statements a year. They were long and lumbering, sometimes soporific in effect.
Now they will have to consume eight of them, though the upside is they’ve gone down in size. Over the past two quarters, RBI has started making its statements more taut and lean. So while RBI dishes out its food more frequently, people can digest it more easily.
But we wonder if there’s a downside. Whatever the size earlier, markets would be eagerly awaiting every quarterly statement: In economists’ jargon, every policy’s marginal utility was high. But if the meals get more frequent, will people be hungry enough to appreciate them?