Abstract

  The paper aims to analyze the possible implications of the decisions taken by the Reserve Bank of India (RBI) in its monetary policy committee (MPC) meeting in the year 2019 for the Indian economy. The MPC is a committee of the Central Bank in India (RBI), headed by its Governor, which is entrusted with the task of fixing the benchmark policy interest rate (repo rate) to contain inflation within the specified target level. Throughout the year the MPC has reduced the policy repo rate and changed its stance from neutral to accommodative. The macroeconomic impact of such decisions has been analyzed in an IS-LM framework. The impact of the corporate tax cut done by the Finance Minister has also been analyzed using the IS-LM and AD-AS approach.

Keywords: Inflation; India; Interest Rate; IS-LM; MPC; RBI; Repo Rate

References

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Citation

Citation: Khyati Kathuria and Pawan Whig. “Macroeconomic Implications of the Monetary Policy Committee Recommendations: An IS-LM Framework" . Acta Scientific Agriculture 4.2 (2020): 121-126.

Copyright

Copyright: © 2020 Khyati Kathuria and Pawan Whig. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.