Owing to the evident accelerated pace of economic adjustment, largely a consequence of the technology-enhanced speed and volume of information flows, we have quickened our pace of policy adjustment this year. Last week, we lowered the federal funds rate to 4 percent, 250 basis points below its level at the turn of the year.
Though RBI issues micro regulations at times, this is necessary to strike a better balance between financial institutions and public interest at a micro level with reference to the common person. Seventh, moral suasion and public articulation of concerns has helped in achieving a desired re-balancing of suspected excesses in risk-taking among banks.