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Operational Independence of Central Banks is Important: IMF

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The International Monetary Fund (IMF) said “operational independence” of central banks like the Reserve Bank of India (RBI) was important for carrying out their responsibilities.

Gerry Rice, IMF Director, Communication, said this in response to a question on the recent developments at the RBI. He, however, added that his views were in the context of international experiences.

“International experience shows that operational independence is important for a central bank to carry out its responsibilities,” Rice said in response to a question.

The RBI played a vital role in ensuring economic and financial stability, and was an important counterpart and partner for the IMF, he said.

Rice added that the IMF had “taken note of” Urjit Patel as the governor of the RBI and the appointment of Shaktikanta Das as his replacement.

“We believe Patel was instrumental in formulating the Reserve Bank of India’s inflation-targeting framework as a deputy governor and in successfully implementing it as governor,” he said.

“In wishing Governor Patel all the best in the future, we also look forward to working closely with Governor Das and wish him well in his new incarnation,” Rice said.

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