Former RBI governor Raghuram Rajan joins US Fed review: What will his role be?

Published 16 July 2026 · finance

Reserve Bank of India (RBI) governor Raghuram Rajan has been appointed to a high-level task force by the US Federal Reserve to review its balance

Reserve Bank of India (RBI) governor Raghuram Rajan has been appointed to a high-level task force by the US Federal Reserve to review its balance sheet policy, placing him at the centre of a broader effort to reshape the central bank's monetary policy framework. Rajan is among the experts selected by newly appointed Federal Reserve Chair Kevin Warsh to serve on one of five task forces examining key aspects of the Fed's policymaking. The review comes as the US central bank reassesses its tools after the pandemic-era expansion of its balance sheet and the subsequent effort in bringing the inflation back to its long-term target. Quick answers to key questions • 5 QUESTIONS 1 What is Raghuram Rajan's role in the US Federal Reserve review? ⌵ Raghuram Rajan is serving on the Balance Sheet Policy Task Force, tasked with examining the costs, benefits, and implications of the Federal Reserve's balance sheet policy. 2 Why was Raghuram Rajan chosen for the Federal Reserve taskforce? ⌵ Rajan is recognized as a leading central banking expert, having served as the RBI Governor and gained international recognition at the IMF for his work on financial stability and macroeconomics.

3 How is the Federal Reserve's balance sheet being reevaluated? ⌵ The reevaluation involves assessing whether the current policy, which saw the balance sheet expand to nearly $9 trillion, remains appropriate, especially in the context of returning inflation to its target. 4 What are the core areas being examined by the Federal Reserve task forces? ⌵ The task forces are reviewing communications, balance sheet policy, economic data usage, productivity and jobs, and the inflation framework to enhance monetary policy. 5 What are the expected outcomes of Rajan's involvement in the Federal Reserve review? ⌵ Rajan's participation aims to bring fresh perspectives to monetary policy decisions, ultimately helping to address persistent inflation challenges and improve the effectiveness of the Fed's operations. Also Read | Raghuram Rajan, Raj Chetty roped in to review US Federal Reserve functioning What will Rajan do? According to news agency PTI, Rajan will serve on the Balance Sheet Policy Task Force along with Harvard University economist Karen Dynan and former Federal Reserve Governor Jeremy Stein. The panel has been tasked with examining the costs, benefits and institutional implications of the Federal Reserve's balance sheet policy, including the size and composition of its asset holdings and their role in implementing monetary policy.