Reserve Bank of India's outgoing deputy governor Viral Acharya has credited flexible inflation targeting by the Monetary Policy Committee, as well as low crude oil prices and efficient food supply management, for successful taming of India's inflation rate.
RBI shifted to flexible inflation targeting with a headline target of 4 percent (+/- 2 percent) when the MPC was instituted in 2016.
"The important reform of flexible inflation targeting, helped by low oil prices and better food supply management, has kept the headline inflation under control during the last five years, relative to the mandated target," Acharya was quoted as saying in a statement on RBI website.
Acharya, whose resignation was announced by RBI on June 24, delivered a lecture on Development of viable capital markets - The Indian Experience at the Indian School of Business, Hyderabad on Saturday.
Capital markets play a crucial role in the economic development of a country and RBI has been making efforts to expand the investor base, he said in the lecture, adding that they are also vital to reach the objectives such as financial stability and transmission of monetary policy.
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