ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Articles by Indranil BhattacharyyaSubscribe to Indranil Bhattacharyya

Priming Monetary Policy for the Pandemic

In response to a once-in-a-century pandemic in which a health crisis rapidly mutated into a macroeconomic and financial shock, the Reserve Bank of India mounted an unprecedented policy response. While the entire response involved an intertwining of monetary, regulatory, and technological measures, this paper focuses on monetary policy initiatives. Distinguishing between conventional and unconventional policy measures, the paper makes an impact assessment in terms of key macroeconomic and financial variables. The lessons drawn from this unique experience are evaluated, with emphasis on framework flexibility, the critical role of communication in anchoring expectations under extreme uncertainty, and the approach of strategic restraint in the face of a normalisation/ tightening bandwagon across advanced and emerging countries. The paper concludes by peering into the near future in which India prepares to manage the spillovers from divergent monetary policies across the world and geopolitical tensions.

How Do We Assess Monetary Policy Stance?

This paper develops a measure of the monetary policy stance from the detailed reading of various monetary policy announcements in India from 1973 to 1998. According to the proposed measure, the stance of monetary policy has been mildly contractionary over this period with its emphasis on inflation control. The constructed measure of monetary policy stance is then linked to output and prices in a three-variable vector autoregression framework, which indicates that, for the period of study, the potency of monetary policy seemed to have been more effective in price control vis-a-vis stimulating output growth.

Impact of Increase in Oil Prices on Inflation and Output in India

This paper attempts to study the transmission mechanism of an increase in petroleum prices on the prices of other commodities and output in India. The paper also examines the nature and the extent of 'feedback' in such a transmission mechanism and obtains evidence of bidirectional causality between oil and non-oil inflation in India.

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