『印度央行宣布加息50基點，緊縮幅度超預(yù)期�！�

　　India's central bank: Fifty sense

　　印度央行加息50基點

　　Jul 26, 2011 | From The Economist

　　SITTING in the office of an Indian boss when the Reserve Bank of India (RBI) raises interest rates with an unexpectedly aggressive jerk, things get a little tense. The iPhone on my host’s desk starts going berserk with incoming messages. The first few are politely ignored, but at last the phone’s owner excuses himself and reads closely. Looking ever so slightly queasy, he eventually explains, “they raised by fifty”. Asked if this means that private-sector investment in India, already weak, will take a lurch down, he shrugs: “Of course.”

　　The RBI was widely expected to boost its main interest rate on July 26th, but by only 25 basis points, not 50. Some optimists even thought that after ten hikes since the start of 2010, a final further quarter-point rise would mark the end of the tightening cycle. Yet there is a good case for tougher action. Inflation is still hovering about 10%, while real interest rates are negative. Although it was initially driven by food, the rise in prices is now broad, and, as the RBI called it in today’s statement, “stubborn”. The central bank lifted its estimate for wholesale price inflation for the year ending March 2012 from 6% to 7%. Having been complacent it is trying to get on the front foot.

　　That scares a lot of businessmen. Already industrial production figures have been weak and there is a lot of talk about capital investment being cut as higher borrowing costs feed through. Debt-funded projects, particularly those in the infrastructure and property sectors, could become vulnerable. Some worry that this may in turn put upwards pressure on banks’ bad debts and hurt the economy’s long-term growth potential. In the view of some industrialists, then, higher inflation is worth tolerating to keep the economy motoring.

　　Not so, says the RBI. It has an economic orthodoxy on its side—that there is no long-term trade-off between growth and low prices—but its stance is also partly political. The pace of reform has been moribund over the past year, as the government has struggled to get a grip on corruption and its policy agenda and a succession of big investment projects have been stalled. The idea that the economy will grow at nearly double digits for the next two decades is now accepted wisdom in India. Yet in reality this will depend on whether key reforms on land, tax and infrastructure are pushed through.

　　The central bank’s statement noted that “the economy’s ability to grow rapidly for any length of time without provoking inflation is dependent on implementing policies.” Translated from central-banker speak that means if the government gets its act together, there might be fewer bottlenecks in the economy, lower prices, and less need to raise rates. Will the government deliver? From his office, still glancing at his phone, the boss acknowledges that the economy is in is a tricky patch. He hopes this might make a moment when “the politicians will rise above politics” and get things done. (499 words)