This trinity seems just as impossible.

"The global economy may slowdown, from 5.5% growth in 2021 to 4.1% in 2022 and 3.2% in 2023, as pent-up demand fades and monetary policy becomes less favorable, the World Bank said," wrote Tauseef Shahidi. "Market hysteria reached an all-time high last year, suggests data from YouGov-Mint-CPR Millennial Survey." Inflows into equity mutual funds in December "rose to a record Rs 24,990 crore (Rs 249.90 billion) -- 2.3 times the amount in November, and 20% more than the previous high of July". "It rained unicorns last year; another 22 startups may follow suit this year," and "'Soonicorns' raised funding in 2021 at a valuation greater than $500 million but less than $1 billion." "Consumer confidence in India hit historic lows due to the virus outbreak, according to the Reserve Bank of India (RBI)," Fortune. "Consumers' perception of the prevailing economic situation and their expectation for the future also influence their spending, saving and investment behavior, says the central bank." "Rural areas, which support nearly 60 percent of the population by some estimates, saw an increase in the average unemployment rate to 7.3 percent in 2021 from 6.8 percent in 2019," ET. Due to structural factors, the economy was slowing down from a growth rate of 8.2% of GDP in 2016-17 to 4% in 2019-20 when Covid struck, wrote Prof Himanshu. "Between 2019-20 and 2020-21, real per capita GDP declined at 0.4% per annum, but real per capita private final consumption expenditure (PFCE) declined by 2.5% per annum." "Industrial growth fell to a nine-month low of 1.4% in November as festive demand fizzled out while retail inflation accelerated to a six-month high of 5.59% in December," ET. If consumer prices are rising despite falling demand then it cannot be due to supply side problems, as the RBI has been arguing. "The RBI expects fiscal and other supply side measures like excise duty cuts to address inflation concerns though it expects inflationary pressures to build up through rise in input prices," ET. If the RBI expects inflation to come down due to duty cuts and go up due to higher input prices, does it mean that retail inflation will remain fixed at around 6%? Input prices are sizzling as "December wholesale inflation eased to 13.56% year-on-year after it hit a record high in November 2021 at 14.2%," ET. The US Fed is not going to wait. "Treasuries slid and yield-curve premiums shrank to the lowest in almost two years amid increased speculation the Federal Reserve will deliver more than a quarter percentage-point rate hike in March," Bloomberg. If the Fed hikes rates by 0.50%, the ordure will really hit the fan. "A tighter Fed poses the risk of capital outflows from India, along with the associated worries over exchange and interest rates," wrote an editorial in ET. If foreign capital flows out of India the rupee may depreciate. This should help exports by making our goods cheaper but, "Imports will become costly." This will add to already high inflation. "So, RBI must act in line with other central banks, not stand in isolation." RBI will obey government orders. The government wants a strong rupee to check imported inflation, lower interest rate to lower its cost of fiscal deficit and low inflation to win elections. An impossible trinity (wikipedia), as it were.