RBI Governor Inflation Commitment: New Delhi – In his address at the Delhi School of Economics, Reserve Bank Governor Shaktikanta Das asserted the central bank’s unwavering dedication to curbing inflation down to 4%. He emphasized the RBI’s vigilance towards risks, noting that regular global supply disturbances could have significant implications on price situation management.
Governor Das stressed that the RBI is actively ensuring that second-order effects, resulting in generalization and persistence related to inflation, are avoided. He reiterated that the central bank’s commitment aligns with the government’s mandate: maintaining inflation at 4%, with a leeway of 2% in either direction.
Shaktikanta Das drew attention to recurring food price shocks, which he identified as a threat to the anchoring of inflation expectations. This process has been in progress since February 2022. “Our watchful stance remains consistent, especially concerning these shocks. Furthermore, the importance of timely supply-side interventions by the government cannot be understated in mitigating the intensity and duration of such food price shocks,” he explained.
In light of the current economic climate, the Reserve Bank Governor emphasized the importance of vigilance against any potential threats to price stability. It is crucial to identify such risks promptly and address them adequately. He reaffirmed, “We are single-mindedly centered on steering inflation towards the 4% mark.” However, he did not specify any particular timeline for achieving this goal.
Governor Das concluded by highlighting recent inflation trends. After peaking at 7.4% in July, largely driven by escalating vegetable prices, inflation has been on a downward trajectory.