India could consider lowering the inflation target and trimming the tolerance band if GDP growth remains robust with a more stable inflation over the next five years, RBI Deputy Governor Poonam Gupta said on Tuesday.
However, if the global environment remains as challenging as it has been during the past six years, it would warrant both predictability and flexibility inherent in the existing framework, she said.
The government, after consultation with the RBI, has notified the inflation target framework for a five year period through March 31, 2031. As per the framework, the Reserve Bank has to keep inflation at 4 per cent (+/-2 per cent) from FY27-FY31.
Speaking at an NCAER seminar, Gupta said the future of the inflation targeting framework in India would depend on the combination of inflation and growth outcomes as they evolve during the next five years.
Also, the future inflation targeting framework would have to take into account the global shocks that the economy may have to​India could consider lowering the inflation target and trimming the tolerance band if GDP growth remains robust with a more stable inflation over the next five years, RBI Deputy Governor Poonam Gupta said on Tuesday.
However, if the global environment remains as challenging as it has been during the past six years, it would warrant both predictability and flexibility inherent in the existing framework, she said.
The government, after consultation with the RBI, has notified the inflation target framework for a five year period through March 31, 2031. As per the framework, the Reserve Bank has to keep inflation at 4 per cent (+/-2 per cent) from FY27-FY31.
Speaking at an NCAER seminar, Gupta said the future of the inflation targeting framework in India would depend on the combination of inflation and growth outcomes as they evolve during the next five years.
Also, the future inflation targeting framework would have to take into account the global shocks that the economy may have to ​Latest News [ SOBAN NEWS: International and National ]
