GOVERNMENT OF INDIA SET UP 3 MEMBER  MONETARY POLICY COMMITTEE

GOVERNMENT OF INDIA SET UP 3 MEMBER  MONETARY POLICY COMMITTEE

10th OCTOBER

The Monetary Policy Committee (MPC) has been constituted by the Central Government under Section 45ZB to determine the policy interest rate required to achieve the inflation target.

The central government has appointed three economy specialists Ashima Goyal, Jayanth R Varma and Shashanka Bhide as external members of the rate-setting Monetary Policy Committee of the Federal Reserve Bank of India.

Due to delay in the appointment of independent members , RBI has postponed its last meeting on 29th September. The tenure of previous three external members of MPC. Ravindra Dholakia, Pami Dua and Chetan Ghate ended in September.

The Monetary Policy Committee that decides the policy rate required to achieve the inflation target.

The inflation target, interest rate and repo rate is being decided by the aforesaid Monetary Policy Committee by taking the factor of Consumer Price Index. On the basis of Consumer Price Index the inflation is decided and hence, the committee forms the regulation.