ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Measuring Banking Intermediation Services

This paper reviews the methodology for estimating output from banking intermediation services in India. The existing practice is compared with the guidelines provided in the United Nations System of National Accounts 1993. The paper identifies certain unsettled issues and problem areas in measuring banking intermediation services.

Construction of a Composite Leading Indicator for Tracking Inflation in India

This paper attempts to construct a 'composite leading indicator' for tracking the future path of inflation rate in India. For doing so, partial information about future inflation rate provided by a number of basic series is analysed first. Based on the correlation analysis, a few of these basic series are chosen for construction of composite indicator. Empirical results show that the percentage change in manufacturing output, money stock, exchange rate, bank credit to commercial sector, raw materials prices, are important leading indicators for inflation rate in India. Accordingly, based on monthly data on these basic series, one composite indicator is constructed which contains information about behaviour of inflation rate six months in advance. It is seen that out-of-sample forecast error of the composite indicator is quite impressive, the magnitude of error in six-months ahead forecast is only 1.2 percentage point.

Inflation in India during the 80s-An Analytical Review

THF primary concern of central banks every where is to maintain internal and external stability of the home currency. The debate about trade off between inflation and employment (output) and controversies regarding specification of Phillips curve notwithstanding, no central bank has shown total disregard about price stability [Branner and Meltzer 1976 and Bhattacharya and Lodh [1990]. A .substantial body of literature now exists to prove or disprove the oft-quoted assertion of Friedman
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