In this context, over the past three years, we backed our actions with clear forward guidance and tweaked it as necessary with reference to the evolving circumstances. For instance, our forward guidance was initially state-based. But, in the second half of 2020-21, there were undue market concerns that the accommodative monetary policy stance might have to be reversed in the face of elevated inflation.
To quell such disruptive forces and their possible negative effects on our accommodative stance, we supplemented our state-based guidance with time-contingent guidance by stating our intent to continue “with the accommodative stance of monetary policy as long as necessary – at least during the current financial year and into the next year ...”.