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Essay Details:
Essay text:
This is tempered with purchasing power
parity considerations as evidenced by the central bank's response to deviations of the spot rate from
moving relative prices' target. This indicates a real exchange rate stabilisation policy by the Indian
authorities.
Keywords: Exchange rate; intervention; exchange rate management; purchasing power
parity; real exchange rate; managed floating; exchange rate target;
JEL Classification Nos. E 58, F3, F31
*
The author is employed by the Reserve Bank of India and currently on deputation to ICRIER. The views
expressed here are however, the author's own and not of the institution to which she belongs...
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