Lagged data, frequent reviews make monetary policy's task challenging: RBI DG Michael Patra

"Monetary policy has to be forward-looking, and that is because when the policy rate is changed, it takes quite a while before it reaches lending rates and aggregate demand in the economy. Hence, we can only target future inflation, not yesterday's," Reserve Bank Deputy Governor Michael Patra said in a speech at the annual SBI conclave.

Lagged data, frequent reviews make monetary policy's task challenging: RBI DG Michael Patra
"Monetary policy has to be forward-looking, and that is because when the policy rate is changed, it takes quite a while before it reaches lending rates and aggregate demand in the economy. Hence, we can only target future inflation, not yesterday's," Reserve Bank Deputy Governor Michael Patra said in a speech at the annual SBI conclave.