The first reason is that they’re volatile. The second is that they’re influenced by factors beyond what domestic policymakers can control. For instance, both food and fuel prices are governed by global demand and supply. The RBI increasing interest rates can’t bring down the price of Brent crude oil. Therefore, central banks focus more on core

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Work in ProgressAmerica’s Most Important Economic Storyteller Is ConfusedAn old economy is dying, and a new economy is struggling to be born. Now is the time of monstrously confusing data.By Derek ThompsonAn illustration of the dollar-bill portrait of George Washington shrugging in confusionThe Atlantic; GettyJune 17, 2022About the author: Derek... See more

Almost anyone can tell you the cost of living has increased between the onset of the pandemic and today. Implying anything else is, as my younger colleagues would say, legit gaslighting, or at least missing the point. Now, in recent months, headline after headline proclaims “inflation has cooled.” But does that mean we are out of the water?

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It will be worthwhile to consider RBI’s recent research highlighting the core type characteristics in high food inflation and its spillover effects on core inflation.

And lastly, the reason for persistently high food inflation despite record agriculture production (FY25 is projected to grow by 5%), much higher than the population growth of 1.1 per

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What the Fed is actually trying to do here—as opposed to the story it’s telling about what’s happening in the economy—is clear, yet extremely difficult: It is trying to destroy demand just enough to reduce excess inflation but not so much that the economy crashes. This a little bit like trying to tranquilize a raging grizzly bear with experimental... See more