Rajan wants global rules of conduct for central banks

Mumbai

RESERVE Bank of India (RBI) governor Raghuram Rajan called for global central banks to adopt a system for assessing the wider impact of their actions, including unconventional monetary policies now in use.

Mr Rajan proposed on Saturday that a group of academics should measure and analyse the "spillover" effects of monetary policies and indicate which should be used and which avoided. He suggested a traffic light system, grading policies green, orange or red.

The monitoring system could be implemented through an international agreement along the lines of the Bretton Woods currency accord or via the I…