Former Reserve Bank of India (RBI) Governor Raghuram Rajan has been named to a high-level task committee by the US Federal Reserve to examine its policy framework, a move expected to influence the future direction of US monetary policy.Kevin Warsh, the newly appointed chairman of the Federal Reserve, announced the formation of five expert groups to review the central bank’s monetary policy.Rajan is among a group of eminent economists, corporate executives and former central bankers selected for the exercise. American economist Raj Chetty, who was born in Delhi, and Asha Sharma, CEO of Xbox and Executive Vice President at Microsoft, have also been appointed to separate task committees.The panels also include Nobel laureate Thomas Sargent, former Walmart CEO Doug McMillon, former Bank of England Governor Mervyn King and Silicon Valley venture capitalist Marc Andreessen.According to media reports, Rajan will serve on the Balance Sheet Policy Task Force alongside Harvard University economist Karen Dynan and former Federal Reserve Governor Jeremy Stein.The panel has been tasked with examining the advantages, disadvantages 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.The review comes after the Federal Reserve’s balance sheet expanded to nearly USD 9 trillion during the Covid-19 pandemic through large-scale asset purchases aimed at supporting the US economy. It is expected to assess whether the Fed’s current approach remains appropriate.Since then, the central bank has been reducing its holdings in an effort to bring inflation back to its target of 2%.Warsh said the task forces would provide the Federal Reserve with fresh ideas after inflation remained above target for more than five years, although he did not specify Rajan’s exact role.“Our purpose here is to make better decisions in the conduct of monetary policy and put these years of high inflation behind us,” Warsh told senators, according to a PTI report.