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Topic 6

The document outlines a macro dashboard for India, highlighting key indicators such as GDP growth, inflation, and unemployment that are essential for assessing economic health. It emphasizes the importance of these indicators for decision-making by governments, central banks, and corporations. Additionally, it discusses the trade-offs in policy decisions regarding growth, inflation, and employment.

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3 views8 pages

Topic 6

The document outlines a macro dashboard for India, highlighting key indicators such as GDP growth, inflation, and unemployment that are essential for assessing economic health. It emphasizes the importance of these indicators for decision-making by governments, central banks, and corporations. Additionally, it discusses the trade-offs in policy decisions regarding growth, inflation, and employment.

Uploaded by

anwit4567mon
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Macroeconomics

A Macro Dashboard for India


If you were
RBI Governor or CEO of Tata
Group,
which 5 macro numbers
would you track every month?
What is a Macro Dashboard?

Definition
A structured set of indicators used to
assess economic health.
Used by:
➢Governments
➢Central banks
➢Corporates
➢Investors
The Core Macro Dashboard
REAL ECONOMY
GDP growth
Employment
Industrial production
PRICES
Inflation (CPI/WPI)
LABOUR MARKET
Unemployment; LFPR
POLICY
Interest rates; Fiscal deficit
EXTERNAL SECTOR
Exchange rate; Current account
Business Decision Lens
CEO uses dashboard for:
Capacity expansion
Hiring plans
Pricing strategy
Investment timing

Example:
High inflation → high interest rates
→Delay borrowing
Macro Trade-off
Triangle

Growth
Inflation Employment

Policy cannot optimize all simultaneously.


A Short Case Discussion
Scenario:
▪ GDP rising
▪ Inflation rising
▪ Unemployment falling

Questions:
➢Should RBI tighten policy?
➢What happens to firms?

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