Q.3 How the central bank influences inflation expectations? Why communication between the Monetary Policy Committee and the RBI is important?

Mentor’s comment-
  • https://indianexpress.com/article/opinion/columns/mpc-monetary-policy-committee-rbi-7983009/
  • In the intro, briefly introduce the MPC.
  • In the body, mention the role played by the RBI in shaping the expectations of the people. In the next part, mention the moves such as separate policy statements, the introduction of GSAP, changes in the reverse repo, and intervention in the foreign exchange market that indicate the lack of communication and highlight the need for a framework to ensure the policy coherence.
  • Conclude by mentioning the need for communication between MPC and the RBI.
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1 year ago

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