A week of confused policymaking

......The RBI's mid-quarter review of monetary policy did not surprise by its preference for the status quo on the repo rates. Operating within the narrow objectives of price stability, its actions were predictable, if disappointing, for those in the organised economy who hold rising interest rates responsible for a decline in investor sentiments. So do some policymakers. But what cannot be forgotten is that a tight money policy has checked one of the drivers of growth, real-estate, from overheating the economy. For the RBI, inflation still haunts the economy, a view that other policy players share reluctantly, eager as they are to show that their fiscal and legislative initiatives have worked to pull back its relentless climb.......

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