Thursday 1 November 2018

Govt vs RBI: Why central banks are required to be independent

Under Section 7 of the RBI Act, Centre has special powers to direct the central bank to follow its orders.The power has always existed before but was never used, until now. An independent central bank ensures that the spender of money (government) doesn't have the power to create it too or dip into reserves at will. This is also meant to act as a constraint on government spending.

from Times of India https://ift.tt/2P30Tdn
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