1. Fiscal Measures
-
- Related with managing taxes and expenditure by the Government
| Methods | Controlling High Inflation | Managing deflation |
|---|---|---|
| Taxes to control consumption | Increase taxes | Reduce taxes |
| Government Expenditure | Reduce | Increase |
2. Monetary Measures
-
- These measures are taken by RBI to control money supply in order to control inflation.
| Instruments | Reducing Money Supply (to control inflation) | Increasing Money Supply (to increase economic growth) |
|---|---|---|
| Bank Rate (BR) | Increase BR | Decrease BR |
| Repo Rate (RR) | Increase RR | Decrease RR |
| Reverse Repo Rate (RRR) | Increase RRR | Decrease RRR |
| Open Market Operations (OMO) | Sell G-Secs | Buy G-Secs |
| CRR | Increase CRR | Decrease CRR |
| SLR | Increase SLR | Decrease SLR |
3. Administrative Measures
-
- Checking hoarding and speculation
- Preventing black marketing
- Streamlining the supply chain
