Amid low inflation, CEA sees no impact on RBI policy as Fed turns hawkish

Monetary policy will not have to be in conflict with fiscal policy in India, as opposed to other economies, says K V Subramanian

A possible tightening of monetary policy by the Federal Reserve may not prompt the Reserve Bank of India to follow suit as inflationary pressures are contained for now, a top government adviser said.

Federal Reserve Chair Jerome Powell paved the way for quicker-than-expected U.S. hikes, which could ripple through rate-sensitive emerging market assets. He told Congress that policymakers will discuss whether to wrap up bond purchases a few months earlier and retired the word “transitory” from his commentary on inflation.

“Monetary policy will not have to be in conflict with fiscal policy in India, as opposed to other economies where monetary policy