Paper Contents
Abstract
AbstractInflation targeting is a monetary policy strategy employed by central banks to achieve price stability. Since the Reserve Bank of India (RBI) adopted an inflation-targeting framework in 2016, it has aimed to keep inflation within a specific target range, primarily focusing on the Consumer Price Index (CPI). This paper analyzes the effectiveness of the RBI's inflation targeting framework in ensuring price stability and its broader impact on the Indian economy. It examines the trade-offs between inflation control and economic growth, with particular attention to factors such as food inflation, core inflation, and the challenges posed by external shocks.1. IntroductionInflation targeting has emerged as a preferred monetary policy framework in many countries, including India. The Reserve Bank of India (RBI) adopted this approach in 2016, with the primary goal of maintaining price stability while supporting economic growth. The framework sets a target range for the inflation rate, which the RBI aims to achieve using various monetary policy tools. This paper investigates the effectiveness of inflation targeting in India, exploring its impact on price stability and the trade-offs between inflation control and economic growth.
Copyright
Copyright © 2024 Manas Verma. This is an open access article distributed under the Creative Commons Attribution License.
