, Columnist
India’s Central Bank Delays the Inevitable
There aren’t many good alternatives to tightening.
The Fed has the RBI in a chokehold.
Photographer: Dhiraj Singh/BloombergThis article is for subscribers only.
When the world’s de facto central bank rustles up an interest-rate whirlwind, you don’t use a fig leaf of flexible exchange rates to stand in its path. That memo, already well-received in Indonesia, doesn’t seem to have reached India.
The Reserve Bank of India chose to hold its policy interest rate at 6.5 percent on Friday. And by delaying the much-debated quarter-percentage-point increase, policymakers signaled their tolerance of financial instability.