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Monetary policy and inflation

A V Rajwade |  Jun 28, 2017 10:40 PM IST

Recent experience in both emerging and advanced economies seems to suggest that the theories and rules of inflation, money supply and interest rates no longer seem to be working. One example is our own experience where inflation seems to be consistently undershooting expectations of the central bank. This is often blamed by policy makers on the inefficiency of monetary transmission; in other words, the signals from the central bank are not getting properly reflected in the price of money in the banking market.  The experience of.....

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