We know that government-owned investment vehicles (GIVs), also referred to as Sovereign Wealth Funds (SWFs), existed for long but they have acquired significance very recently due to their proliferation, growth in size and, above all, active participation in capital infusion in the aftermath of the recently observed financial turbulence.
Consumer prices, even when excluding volatile commodity prices, are subject to shocks from both the demand and supply side of the economy; for example, movements in the nominal exchange rate have an impact on the domestic prices of imported goods. These shocks can operate over a much shorter horizon than that of the transmission mechanism of monetary policy.