Master Microeconomics for RBI DEPR Exam Important Topics

[00:00:00]The in May 2016, the RBI Act 1934 was amended to provide a statutory basis for implementation of flexible inflation targeting framework within the economy.

[00:00:13]The central government in consultation with RBI determines the inflation target in terms of consumer price index which was then put in place with 2012 base.

[00:00:25]And because earlier historically we were tracking the wholesale price index, but which gives us a kind of a snapshot of input cost, but services were not a part of the wholesale price index basket. So, it was felt necessary to first come up with a CPI which is uh which is kind of a complete indicator which includes agriculture, which includes industry, which includes services and complete indicator of the economy.