The two important variables for the policy formulation are projected inflation and the output gap. There is no clear hidebound mathematics that we must give 'X' weight to inflation and 'Y' weight to growth and form the associated policy.

There will always be divergence of views on the output gap, as it is unobservable in a rigorous direct sense. There are only estimates. How can there be a strong consensus on that?

Growth is always there in the MPC's scheme of things; we don't lose sight of that, but not at the cost of inflation.

Urjit Patel Quotes