تثبیت نرخ ارز واقعی و مدیریت شناور: سیاست نرخ ارز در هند، 2001-1993

The paper examines the exchange rate management objectives of the Indian central bank after the shift to a floating exchange rate regime in 1993. It argues that three empirical features of the post-float period, viz. nominal and real exchange rate stability and increase in reserves’ volatility are inter-related. A policy reaction function relates these features and finds that central bank intervention behaviour is characterised by significant effort to lean against the wind during 1993–1999. This is tempered with purchasing power parity considerations. It concludes that the exchange rate was extensively managed to target the real exchange rate.