News Tamil Nadu

Puthiya Thalaimurai Journo Exposes His Lack Of Knowledge About Repo Rate And Inflation

February 9, 2023
The Commune

The Reserve Bank of India’s Monetary Policy Committee (MPC) raised the key policy rate, the repo rate, or the rate at which the RBI lends funds to banks, by 25 basis points to 6.50 percent on Wednesday (9 February 2023) in an effort to contain retail inflation. The RBI decision is expected to increase the cost of all external benchmark-linked (based on the repo rate) loans immediately.

Following the rate hike, the DMK IT wing and DMK supporters masquerading as journalists spread misinformation about the rate hike. In one such attempt, Puthiya Thalaimurai journalist Niranjan Kumar said, referring to the rate hike, “Let the dream of buying a house remain a dream till the end.”

However, it should be noted that the interest rate cycle is closely related to the economic or trade cycle. In theory, movements in interest rates should mirror the economic cycle. If the economy is growing strongly and inflationary pressures increasing – Central Banks will increase interest rates to slow down the economy and prevent inflation. If the economy enters into recession with falling inflation and rising unemployment – Central Banks will cut interest rates to provide an economic stimulus to try and increase the rate of economic growth.

This is basic knowledge that is expected of a journalist reporting for a major news outlet. However, Puthiya Thalaimurai journalist Niranjan Kumar either concealed this fact knowingly or exposed his ignorance of knowledge about the Repo rate and inflation.

Political commentator Badri Seshadri pointed out the journalist’s lack of understanding of the repo rate and inflation, saying, “When there is inflation, you scream prices are increasing. However, when the RBI raises interest rates to control inflation, you scream that your house-buying dream is over. If the RBI lowers interest rates after inflation has subsided, you will scream that saving banks’ interest rates have been reduced.”

An enraged Niranjan Kumar, resorted to body shaming after being exposed. He even blamed the RBI for the rise in milk prices. He said, “One need not be a journalist or fat guy (I am not responsible if you think I am referring to you) to tell the hardship. In a year, the price of a litre of milk has risen by ₹6.”

Responding to the provocation of the Puthiya Thalaimurai journalist, Badri Seshadri explained in a series of tweets that central banks around the world will raise interest rates when inflation rises and lower interest rates when the economy suffers. He also advised Niranjan Kumar to contact his employer if his salary has not increased in the last three years.

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