Real interest rate

RBI Study on Impact of Real Interest Rate on Growth and Investment

While lower real interest rates can stimulate growth and investment, central bank cannot adopt a policy of higher inflation tolerance as the means to lower real rates because beyond a threshold the negative impact of inflation on growth outweighs its positive impact through lower real interest rate. This was the conclusion of a study undertaken by… Read More

Tags: Central bankEconomic growthFederal Reserve SystemGDPIndiaInvestmentReal interest rateReserve Bank of India

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