Why in news?
- Economy needs a further monetary stimulus, thus indicating that the central bank was open to cutting interest rates as Green shoots are visible
- While the macroeconomy needs further monetary stimulus, the inflation outlook continues to be uncertain
- Considering the overall evolving growth inflation situation, it would be prudent to continue the focus on growth in the context of the expected moderation in inflation
What is monetary stimulus?
Monetary stimulus refers to lowering interest rates, quantitative easing, or other ways of increasing the amount of money or credit. It is an effort to increase economic activity by increasing the amount of money in the economy