....... If, for instance, the RBI’s moves to tighten liquidity and indirectly raise interest rates to check the rupee’s fall stays longer than intended, there is no doubt that growth will suffer. But growth will also be impacted if the rupee continues to weaken, inflation remains high, unhedged corporate balance sheets come under increased pressure and fiscal consolidation becomes even more challenging. The urgent task is to calm the markets. Clearly, for policymakers there are no easy options at the moment. Having chosen a particular line, it is best to stay on course lest the credibility of our monetary institutions is undermined. More effective communication will certainly help, as will the RBI and the government following the elementary rule of not speaking in discordant voices.
The very purpose of VITALINFO is to provide a platform for wider dissemination of updated information related to and happening of events in and around RBI.
No comments:
Post a Comment