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
