What I would like to do today is to briefly recount the measures taken to develop various financial markets in India, document the outcomes and broadly sketch out the direction of the way forward. From the point of view of the central bank, developed financial markets are critical for effective transmission of monetary policy impulses to the rest of the economy.
However, these factors will offset each other, which leaves this year’s inflation forecast unchanged. Inflation will meet the target range of 5%+/-1 pp in early 2020 and reach the medium-term target of 5% at the end of 2020. As in 2019, tight monetary conditions will curb price growth.