Monetary Policy, Trade Openness and Economic Growth in India

What is it about?

This article examines the role of monetary policy and trade openness to raise income in India for the monetary-targeting regime and the multiple-indicator approach regime of monetary policy.

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Why is it important?

The results confirm that the monetary policy in India is successful in raising income under the monetary-targeting regime and the multiple-indicator approach regime of Indian monetary policy. The interest rate has also responded to change in some instruments of monetary policy, income and trade openness in the conventional trail, indicating that the principal monetary instrument, like the real interest rate, can be used successfully to achieve monetary policy targets.