Why RBI needs to look beyond inflation
The pandemic has revealed the limitations of India’s monetary policy. What’s a better way to approach 2021?
As the inadequacies become obvious, India is now paying lip service to inflation targeting while actually pursuing a de facto integrated policy framework. This needs to be formalized.
MUMBAI : Through covid-19, the Reserve Bank of India (RBI) and the Monetary Policy Committee (MPC) have had to undertake a series of extraordinary steps. These include deep policy interest rate cuts, strong banking liquidity infusion, intense bond and currency market operations, besides measures to preserve financial stability.