In firing a policy bazooka to support growth, India’s central bank may have overlooked the consequences for its mandate
While all MPC members work with the same data, one would expect individual assessments to vary. Unless they are victims of group- think. This is entirely possible—nay, probable—in the case of RBI officials who would understandably find it difficult to disagree with the governor. Yet, going by the unanimous vote, not one of the external members seems to have any qualms that a further rate cut and liquidity bonanza could be an overdose, endangering RBI’s primary mandate of price stability.
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