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The central bank said in a monetary policy statement posted on its Web site late Thursday that its target for all of this year is for M2 to increase 17 percent -- a goal that would require tighter policy.
Financial markets had been widely expecting the Fed to raise the benchmark rate, and the reaction among investors was muted, even as the official monetary policy statement struck some as signaling growing confidence that rate increases would continue, and might even proceed at a faster pace.
"The balance of risks stemming from the Reserve Bank's assessment of the growth-inflation dynamic yields little space for further monetary easing," the RBI said in its monetary policy statement.
The Federal Open Market Committee releases its monetary policy statement on Wednesday at 2pm, when it is expected to continue reducing or "tapering" its bond-buying stimulus by $10 billion a month with a view to finishing this unorthodox "quantitative easing" program after its October meeting.
At 2pm on Wednesday, the Federal Open Market Committee will release its much-awaited monetary policy statement, with markets anxious to read the nuances of the Fed's take on the economy and to try and gauge when the Fed will raise interest rates back towards normal levels.
The Fed's monetary policy statement in July contained upbeat language that appeared to open the door to a rate hike as early as its next meeting in September.
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The bank's problems lie less in its actual interest-rate decisions than in its poor public communication, its apparent lack of flexibility and its excessive independence, all of which make it an easy target to attack.The constantly hawkish tone of its monetary policy statements give the impression that the ECB focuses only on inflation and does not care about growth.
After a two-day meeting, the Federal Reserve dropped the word "patient" from its monetary-policy statement.
Today, after a two-day meeting, the Federal Reserve is expected to drop "patient" from its monetary-policy statement.
Most of the existing unemployment represents mismatch that is not readily amenable to monetary policy.This statement has contributed to the belief that the Fed may not be able to maintain its programme of new easing in 2011, when several QE-sceptics, including Mr Kocherlakota, will become voting members of the Federal Open Market Committee.
On a "macro" level, recent statements from the Federal Reserve regarding monetary policy, combined with statements from the President-elect regarding fiscal stimulus, have led to predictions of higher interest rates.
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