FIT is fit for purpose, sure, but India has missed a chance to refine its inflation targeting regime
As RBI’s deputy governor in charge of monetary policy and Barry Eichengreen, professor of economics at the University of California, Berkeley, observe in their August 2024 paper reviewing India’s FIT, “Radical changes such as broadening the RBI’s monetary mandate, abandoning the target in favour of a more discretionary regime, targeting core instead of headline inflation, or altering the target and tolerance band would be risky and counterproductive.”
Post Comment