Reserve Bank of India's (RBI) former governor Raghuram Rajan, Delhi-born economist Raj Chetty and Microsoft executive Asha Sharma have been appointed to key independent task forces constituted by the US Federal Reserve (Fed) to review and strengthen the conduct of monetary policy, highlighting the growing influence of Indian-origin experts in global economic policy-making.
The appointments were announced by
Fed chairman Kevin Warsh as part of a sweeping initiative to establish five high-level task forces that will examine critical aspects of the US central bank's monetary policy framework, including communications, balance sheet policy, data quality, productivity and jobs and inflation frameworks.
According to the Fed, the task forces will be supported by Fed staff but will operate independently with a mandate to follow the evidence, provide candid feedback and deliver rigorous recommendations to the federal open market committee (FOMC), the central bank's principal monetary policymaking body.
"The Federal Reserve's commitment to price stability and maximum employment is unwavering. As is our resolve to pursue our mandate with rigour," Mr Warsh said while announcing the initiative.
"The US economy has changed significantly over the last generation, and never more so than right now. Each task force will carefully consider whether policymakers' means and methods, analytical tools, and policy approaches can be improved. I am honoured that the best minds from a range of disciplines have agreed to work with us to sharpen our performance as an institution. The goal is straightforward: to ensure the Fed is best positioned to achieve our objectives in this consequential time," he added.
Dr Rajan, professor of finance at the University of Chicago Booth School of Business and former governor of RBI, has been appointed to the balance sheet policy task force.
He will serve alongside Harvard University economics professor Karen Dynan and former Fed governor Jeremy Stein.
The panel has been tasked with examining the costs, benefits and institutional implications of the Fed's current balance sheet regime, an area that has gained increasing prominence following years of quantitative easing and subsequent balance sheet normalisation.
Harvard University economist Raj Chetty has been appointed to the data task force which will focus on improving the quality and timeliness of real-time economic indicators used in Federal Reserve policy-making.
He will work with Walmart's former president and chief executive officer (CEO) Doug McMillon and University of Chicago economics professor Kevin Murphy.
Mr Chetty is internationally recognised for pioneering research that uses administrative and real-time data to study economic mobility, inequality and labour markets. His expertise is expected to contribute to developing more responsive economic indicators for monetary policy decisions.
Microsoft's executive vice president and Xbox CEO Asha Sharma has been appointed to the productivity and jobs task force, reflecting the Federal Reserve's increasing focus on the economic implications of emerging technologies.
She will serve alongside venture capitalist Marc Andreessen, co-founder and general partner at Andreessen Horowitz, and Stanford University economics professor Charles I Jones, who is currently on leave at Anthropic.
The panel will assess the impact of new general-purpose technologies, including artificial intelligence, on productivity, employment and broader economic performance to help inform the Federal Reserve's policy judgements.
Federal Reserve said the five task forces will review areas central to the conduct of US monetary policy.
The communications task force, comprising Peter R Fisher of the University of Washington, Arminio Fraga, former president of the Central Bank of Brazil, and Mervyn King, former governor of Bank of England, will examine how the Fed communicates policy deliberations and decisions during periods of uncertainty.
The balance sheet policy task force, including Dr Rajan, will review the Federal Reserve's balance sheet framework and its institutional implications.
The data task force, which includes Mr Chetty, will focus on improving the quality, coverage and timeliness of economic data that underpin policy decisions.
The productivity and jobs task force, featuring Ms Sharma, will study how transformative technologies such as artificial intelligence affect productivity growth and labour markets.
Meanwhile, the inflation frameworks task force will revisit how the Federal Reserve understands and responds to inflation dynamics. The panel comprises Harvard economist and former chairman of the Council of Economic Advisers Greg Mankiw, Nobel laureate Thomas Sargent of New York University and William White, former economic adviser at the Bank for International Settlements and senior fellow at the CD Howe Institute.
Federal Reserve said each task force will be co-led by accomplished economists, business leaders and former central bank practitioners with deep expertise in their respective fields.
Supported by Federal Reserve staff, the panels will function independently and are expected to produce evidence-based findings and recommendations for the FOMC as it evaluates whether the central bank's analytical tools, policy approaches and institutional practices remain suited to an economy undergoing rapid structural change.
The appointments of Dr Rajan, Mr Chetty and Ms Sharma underscore the prominent role played by Indian-origin economists and technology leaders in shaping discussions on the future of monetary policy, data-driven decision-making and the economic impact of artificial intelligence at one of the world's most influential central banks.
