RBI should adhere to its price-stability mandate

Headline inflation is a better yardstick of tlie impact of prices on peoples well-being in India than some truncated construct. RBI lias good reason to stick to tlie price gauge tliat itis using

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Less than four years after the government concluded its review of India's inflation-targeting regime in April 2021 and opted to keep both its target and nitty-gritty-its target range, indicator, etc-unchanged, its view of inflation targeting seems to be shifting. After commerce and Industry Minister Piyush Goyal and then finance minister Nirmala Sitharaman called for lower interest rates, on Tuesday Chief Economic Advisor (CEA) V. Anantha Nageswaran questioned the use of headline retail inflation as India's yardstick to guide monetary policy. If Goyal flayed the Reserve Bank of India's (RBI) rate policy, saying it was a "flawed theory" that food inflation should be considered while framing it, the FM was just as forceful, calling for bank interest rates to be "far more affordable" and adding that several people found the cost of borrowing "very stressful." In contrast, the CEA stopped short of calling for a cut in interest rates. Speaking at a State Bank of India conclave, he pointed out that if the prices of just a few items are excludednotably