WBCS.LIVE practice question

In India, which authority is responsible for formulating the 'Monetary Policy'?

Solve this multiple-choice question and check the correct answer with its explanation below.

Answer options

  1. Ministry of Finance
  2. SEBI
  3. Reserve Bank of India
  4. NITI Aayog

Correct answer and explanation

Correct answer: Reserve Bank of India

Explanation: āœ… Correct Answer: C) Reserve Bank of India šŸ“š Explanation: The Reserve Bank of India has the primary responsibility for maintaining price stability while keeping in mind the objective of growth. It uses various instruments like Repo Rate and Reverse Repo Rate to control the supply of money in the economy. Since 2016, this task has been managed by the Monetary Policy Committee (MPC) within the RBI.