The Indian government has appointed a well-respected deputy governor Urjit Patel at the Reserve Bank of India to become the country’s next central bank governor, ending months of uncertainty over the appointment.
Advertisement
“Congratulations to Patel on becoming RBI Governor”.
In addition to giving stability to the currency, Dr. Urjit Patel as the Deputy Governor of RBI, has played a pivotal role in the development of new monetary policy framework that has pinpointed at bringing inflation under check.
“From that perspective, this would be work in progress”. For USD-INR, we expect it to continue to hold within the 66.50-68.00 range, it added.
Patel, who replaces Raghuram Rajan as the head of the central bank, is now the deputy governor responsible for the RBI’s inflation-targeting monetary policy framework. “CII is confident that the new Governor will lead the central bank and take its developmental and regulatory agenda to new heights”, said Chandrajit Banerjee, Director General of CII in a statement. RBI’s next monetary policy review is due on October 4.
The government also revealed it is the first time that a “systematic approach and an objective mechanism” was put in place for the appointment of the governor.
The government has already given legal backing to a policy framework for inflation targeting of 4 per cent with a 2 per cent point band on both sides.
The changes he helped drive are considered to be among the most significant monetary policy reforms since India opened up its economy.
Had stints with multilateral institutions, bureaucracy, central bank, global consultancies and even private companies. Also, market is considering it as a hint of policy continuity by the RBI. He has been the key architect of inflation target and rate-setting panel.
“Patel’s selection is a vote of confidence by the government in the monetary policy initiatives started by Raghuram Rajan”, he told AFP.
Has served the International Monetary Fund in the US, India, Bahamas and Myanmar.
His appointment ends weeks of speculation about a successor to Rajan, who announced unexpectedly in June that he planned to return to academia.
Still, analysts, say they still see scope for an interest rate cut at the end of this year or early in 2017 should food prices moderate in coming months as monsoon rains have been above average.
However, some Deputy Governors served as Governors only for interim periods.
Advertisement
Half of the six-member MPC will be from Reserve Bank and the remaining will be nominees of the government.
