Reserve bank of India (RBI) established on 1 April1935 and Federal bank established on 23 April 1931 are the most important , trustworthy and central banks of the world's largest democracy and economy , that nothing can be failed to approach with these banks' support. Most people think and analyze it to choose the best one . It might depend on their growth expenses with higher interest or it might also depend on their growth expenses with low interest as well , but have you ever thought about what could be the best, RBI or federal bank?
Both Reserve bank of India and Federal bank have differing views depending upon the basis of policies . They are well balanced in their own perspectives regarding their interest rate , policy , assurance , current assessment as a balanced monetary policy should place importance on both growth and inflation, as both statistics are vital to the well functioning of any economy. Since the very first RBI has maintained its policies extremely tight since the very first . Interest rates have been rising over past years in order to combat inflation . The recent inflation data has been lowered , but still still remains at levels which are basically high.
The tight financial policy has been slowing abruptly increasing rates . The RBI has recently indicated its concern due to increase in growth and may reverse its policies in the future. Nonetheless, their main aim is to put a target first on expansion then make growth the second . On the one hand, we have the Fed, whose policies are primarily driven by growth and employment figures, at the expense of enlargement. On the other hand, we have the RBI, whose policies are primarily driven by enlargement at the expense of growth. So which approach is the best?
The answer depends on which quarter of the economy we are concerned with. In a financial environment with high interest rates, business investment suffers, and consumer access to credit suffers. On the other hand, savers benefit due to high interest rates In contrast, loose money has the opposite effects. Economic benefit as they can borrow more cheaply debtors benefit as they pay lower rates. Savers suffer due to receiving low interest rates, and those on fixed incomes suffer from higher rise .