UPSC Prelims 2023 · GS Paper 1 · Q72

Economy

Easy · Post-pandemic monetary policy tightening

Statement-I: In the years following the COVID-19 pandemic, central banks across major economies, including India, undertook a sustained cycle of policy interest rate hikes.

Statement-II: Central banks generally operate on the assumption that raising policy interest rates can help bring down elevated consumer price inflation.

Which one of the following is correct in respect of the above statements?