Monetary Policy Framework Agreement
The GOI and RBI signed a Monetary Policy Framework Agreement, The objective is to primarily maintain price stability, while keeping in mind the objective of growth.
Inflation
Inflation is the rate of increase in prices over a given period of time. It means your money won’t buy as much today as you could yesterday.
Latest MPC Review
In the latest MPC review concluded on 6th December, it’s decided to keep the repo rate unchanged but reduced the CRR by 50bps
NAIRU – Non Accelerating Inflation Rate of Unemployment
NAIRU is the lowest unemployment rate that can be sustained without causing inflation to rise. It’s a measure of the economy’s “spare capacity”
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Phillips Curve
Phillips Curve states that inflation and unemployment have an inverse relationship; higher inflation is associated with lower unemployment and vice versa.
Should RBI target Core Inflation or Headline Inflation
The Economic Survey for 2023-24 questioned the merits of India’s inflation targeting regime, which aims at a headline inflation rate of 4% with a band of 2% on either side. It mused aloud whether a regime that targets inflation, excluding food prices, would be more appropriate in the Indian context, especially given the unintended effect
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Inflation – Indian Economy, Previous Year Questions(UPSC CSE)(2011-24)
1. In India, which one of the following is responsible for maintaining price stability by controlling inflation? (a) Department of Consumer Affairs (b) Expenditure Management Commission (c) Financial Stability and Development Council (d) Reserve Bank of India 2.With reference to Indian economy, demand-pull inflation can be caused/increased by which of the following? Expansionary policies Fiscal
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