“Sooner or later, the public always understands what the central bank is doing, whether for the good or for the bad.”
On inflation, he said although the central bank strongly favours the Urjit Patel's committee suggestion on targeting CPI inflation, a formal adoption of the same will happen only after government approval.
The remark comes within days of stating that RBI's view on inflation is aligned with that of the government.
After the G20 meeting in Sydney last Monday, Rajan had told a TV channel that RBI view on inflation targeting was in sync with the government view on inflation management.
“We have a committee which has suggested a target, which is also by the way, consistent with the process the finance ministry's committee has suggested, so there is no disagreement about the broader need to get a framework in place,” Rajan had said.
“All we have done thus far is to adopt the reasonable suggestion of the Patel committee that we focus on CPI inflation rather than WPI inflation as our primary objective,” he said at a Fimmda-PDAI conference here this evening.
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