A Project Draft On “Policy Interest Rates, Market Rates, Inflation and Economic Growth”

Summary

This project draft from NITI Aayog investigates the complex relationship between policy interest rates, market rates, inflation, and economic growth in India. The core challenge is understanding the transmission mechanism of monetary policy, particularly given observations of limited pass-through from policy rate changes to lending rates and economic output. The study aims to identify these linkages, reviewing existing literature, the evolution of India's monetary policy framework, including the 2016 adoption of inflation targeting and the 2019 shift to external benchmarking for lending rates. As a project draft, the study is currently in progress, with planned quantitative analysis to derive conclusions and recommendations.

Key Facts

Source Document

https://example-government.gov/policy-document-link