RBI's inflation target: Here’s what statistician Pronab Sen has to say
The Reserve Bank of India (RBI) has released its internal review of the Monetary Policy Framework. They have merged it into the report on Currency & Finance for 2020-21.
The Reserve Bank of India (RBI) has released its internal review of the Monetary Policy Framework. They have merged it into the report on Currency & Finance for 2020-21.
Reserve Bank’s internal report has emphasized that this 4 percent if the correct target, that above 6 percent growth tends to get hampered and under 2 percent it gets anaemic and therefore 4 percent plus or minus 2 percent is the correct number.
Pronab Sen, former Chief Statistician, said, “As far as the target is concerned I have absolutely no problems at all. What really needs to be looked at is that in achieving that target which they have come whether or not there has been collateral damage to the economy.”
He said, “On this my personal view is that having only the headline CPI is actually not a very good idea and we should have two different targets one for headline CPI and the other for core CPI and it should be left to MPC to decide which of the two targets it needs to meet at any given point of time, both do not have to be met.”
Watch the video for the in-depth analysis.
(Edited by : Bivekananda Biswas)
First Published: Feb 26, 2021 4:12 PM IST
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