Digitalisation helps improve monetary policy transmission: RBI

If digitalisation were to lead to a decline in resistance to price change by 10%, say, due to the rising online presence of retail stores and dynamic pricing algorithm, inflation fall could be higher at 35 bps without impacting the output in the economy. If the price elasticity of demand falls, inflation could drop by 30 bps (5 bps more than its baseline level), the study explains.