*Research Fellow, Birla Institute of Management Technology
**Professor, Birla Institute of Management Technology
Online published on 20 May, 2017.
The purpose of this research paper is to find out the empirical relationship between international crude oil prices, monetary policy initiatives of the Reserve Bank of India and wholesale price index (WPI) based inflation in India since April 1991–92 to May 2015–16. Monetary variable is the broad money supply. Model used is VAR. The study has found that since April, 2002 (when some of the petroleum product prices started to be market determined) crude oil has more influence on inflation in India than money supply. Similarly, the crude oil price variation explains significant variation in inflation in India.
