One such development was the changed perceptions about the world economic outlook in 1999 and 2000. If you remember, 1998 was a weak year for the world economy, largely because of the widespread fallout from the Asian crisis.
It would be wrong to say that policymakers slammed on the brakes. Rather, we eased off the accelerator. The monetary policy adjustment was the most limited and gradual in recent history, with the repo rate rising by just 2 percentage points over 27 months. At 7%, which is where we are now, the policy rate remains quite low from a historical perspective.