A
The rate of price increase that households and businesses expect to occur in the future
B
The total foreign exchange reserves held by commercial banks
C
The exact fiscal deficit target set by state governments for the upcoming quarter
D
The employment growth rate across rural manufacturing sectors
Correct answer: (a) The rate of price increase that households and businesses expect to occur in the future
Explanation
Inflation expectations refer precisely to the rate of price increase that households and businesses expect to occur in the future, which is captured by the RBI surveys to aid monetary policy. The other options refer to entirely different economic indicators.
Same topic · past papers
UPSC has asked this before
These previous-year questions sit on the same topic. Open one to practise the earlier ask.