Spotlight: Econ Op-eds in Summary (Week ended 17th February '21)
1. Inflationary pressures on the horizon
By: Prof. Sirimevan Colombage
Given the fast growth in money supply, rupee depreciation, world fuel price hikes and supply shortages in the backdrop of the pandemic, there are signs of high inflation in the coming months.
As such, while it is imperative to adopt expansionary fiscal and monetary policies during this crisis period as practiced in many other countries, the government should take precautionary measures to counter the impending inflationary tensions.
While measures like the recently introduced price controls might be useful in a limited manner to ease inflationary tensions during the pandemic, concrete economic strategies aimed at disarrayed macroeconomic fundamentals are essential to deal with the root causes of inflationary pressures.
(Compiled by: Promodhya Abeysekara)
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