In the fragile global economy that followed the pandemic, monetary policy has come to bear a heavier burden than ever before. It is no longer expected to simply balance inflation and growth. It is also expected to communicate intent, reassure markets, and reflect alignment with national development priorities. In India, these expectations have created a narrow space for the Reserve Bank of India’s Monetary Policy Committee, where every decision carries weight far beyond the numbers it announces.The MPC’s recent series of rate cuts have been described as bold. They were front-loaded, and, to some, necessary to give growth an additional push. Headline inflation has largely remained within the target range over the past year, which gave the RBI some room to act. But the current economic context is layered with new uncertainties, and this makes the decision-making terrain far more delicate than in past cycles.
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