Book Review: Who moved my interest date ?

Who Moved My Interest Rate: Leading the Reserve Bank Through Five Turbulent Years by Duvvuri Subbarao
My rating: 4 of 5 stars

When it comes to RBI Governors, all we can think of is either Manmohan Singh or Raghuram Rajan. If there were a scale to measure the personality evolution of central bank Governors in India, both of them would represent the ends of the scale. People seldom talk about the ones in between. Duvvuri Subbarao, 22nd Governor of RBI, came to the helm amid one of the most severe recession of modern times. His book mostly revolves around the time from 2008 to 2013 and gives a gist of the development that took place. I have broken down the review based on some of the important events in the Book:

• From North Block to Mint Road: Being the Finance secretary to the PM's office, his appointment as the RBI governor came as surprise to most in the speculation market.It was the PM who had convinced Chidambaram to consider Subbarao as the Economic Advisor earlier on. It was Chidambaram's turn to nudge the PM this time.
• Baptism by Fire: There was hardly any transition time between jobs for Subbarao. With just a few days in office, he had to face the Global crisis of 2008. The ripples of the meltdown were felt in most devoloped economies. India, however, remained immune to the otherwise global pandemic. Therefore,some credit of India coming out unscathed must be given to Subbarao. His tenure endured stiff challenges. Soverighn crisis of EU,Rupee Tantrum, Import Export Balance, Taper Tantrum
• Inflation Targeting:RBI, over the year, has worked on a more holistic kind of approach without focussing too much on single metric. Hence when the subject of engineering the monetary policy based on an inflation target was brought up, Subbarao was forthright in his stance. He suggested that such a framework would not ensure economic balance as seen in New Zealand during the 90's. Several studies were carried out under the aegis of Urjit patel (another RBI governor) who eventually suggested to peg monetary policy against inflation. India, under the leadership of PM Modi eventually brough the inflation targeting framework into effect
• Rupee Tantrum (read as falling rupee), Taper tantrum (slowing down of the Quantitaive easing program), Gold Reserves, being at loggerheads with the Govt on inflation and price stability were some of the highlights of his career where he had to manage market expectations while also doing the right things


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