The Hindu Editorial Vocabulary– Aug 9, 2021; Day 116

The importance of reading editorials of reputed newspapers is not hidden from anybody. What causes obstruction are difficult words which act like speed-breakers forcing you to either refer to a dictionary for its meaning or simply guess it. While getting the meaning from the dictionary is the best way to understand it, sometimes a dictionary is not within your reach. Also, a number of aspirants get confused when they see more than one meaning next to a word in a dictionary. It becomes a difficult process for them to pick the relevant meaning.

We at PracticeMock understand this and that’s why we have come up with a series of Editorials’ Difficult Words where we shortlist the important editorials of the day and pick the difficult words/ phrases therein. Next to the word, we put only the contextual sense of the word/ phrase so that you don’t get confused. Now let’s go through today’s editorial.

Tightrope walk: On reining in (to limit or control) inflation and RBI’s credibility

The RBI should not undermine its own credibility by delaying steps to rein in inflation

Governor Shaktikanta Das’s statement accompanying the RBI’s latest policy announcement highlights the bind (​​a statutory constraint) that monetary authorities find themselves in. While the central bank’s growth supportive actions — maintaining the benchmark interest rate at a decade low, ensuring ample liquidity and an accommodative policy stance — are yet to help engender a meaningful recovery, inflation continues to disquietingly hover around (to hang or wait around someone or something) the 6% upper bound of its mandated target. Governor Das acknowledged the RBI’s predicament (a difficult, unpleasant, or embarrassing situation) when he said: “Before the onset of the pandemic, headline inflation and inflationary expectations were well anchored (to make something stay in one position by fastening it firmly) at 4%, the gains from which need to be consolidated and preserved. Stability in inflation rate fosters credibility of the monetary policy framework and augurs well (a sign that things will go well) for anchoring inflation expectations. This, in turn, reduces uncertainty for investors… increases external competitiveness and, thus, is growth-promoting.” It is this vital inflation targeting remit that the Monetary Policy Committee has temporarily set aside in the wake of COVID-19 and its brutal impact, while the central bank focuses its efforts on using all available policy tools to simultaneously preserve financial stability and support a durable economic revival. Still, the central bank’s outlook for growth and inflation shows it is cognisant (having knowledge or being aware of) of the ground realities and the limits to its policy options.

Asserting that domestic economic activity has started to recover with the ‘ebbing ( gradually lessen or reduce) of the second wave’, the MPC is hopeful of a bounce back in rural demand on the back of agricultural output remaining resilient, coupled with urban consumption recovering as the manufacturing and service sectors rebound with a lag, and as increased vaccinations help release pent-up (unable to be expressed or released) demand. However, given that underlying conditions are still weak and the Current Situation Index of consumer confidence in its own July survey is still stuck near the all-time low polled in May, the RBI has retained its full-year GDP growth forecast at 9.5%. The fact that it has at the same time lowered the Q2, Q3 and Q4 growth projections it made just two months ago, by between 0.5 and 0.9 percentage points, belies the uncertainty in its outlook. With the monsoon rainfall deficit once again widening to minus 4% as on August 8, latest kharif sowing estimates revealing an almost 23% shortfall and composite PMI data for July showing a persistent contraction in business activity and continuing job losses, it is hard to see either a near-term revival in demand or an easing in inflationary pressures from cereal and edible oil prices. Admitting the price pressures, the RBI has also raised its fiscal-year inflation projection by 60 basis points to 5.7%. Also, with one of the six members of the MPC dissenting and voting against the language of the policy stance, it seems clear the central bank may sooner than later have to bite the bullet and start normalising rates if it wants to avoid undermining its own credibility by delaying steps to rein in inflation.

Hope you got to know some new words/phrases which will definitely be useful in the English section of upcoming competitive exams. Wishing you all the best for your preparation!

Want to improve your vocabulary further? Download the Lists of Word-Meanings of Previous Months here.