Monetary Policy Committee, a council originated by the central government, which formed with the objective of setting the standard policy rate to stabilise inflation within a particular target level.
It is chaired by the governor of RBI who controls the monetary policy decisions with the assistance and the guidance of the internal team and the technically advisory committee.
MPC was formulated under the Reserve Bank of India Act 1934, as an initiative to bring more lucidity and accountability in fixing the monetary policy of India. MPC conducts its meeting quarterly and the monetary policy is issued after every meeting with each associate elaborating his opinions.
The quorum set for the MPC meeting is 4 members, though, there are 6 members in total. Each member of the MPC has one vote, and for the quality of votes, the governor has a second or casting vote.
A report is publicised by the RBI biannually, known as monetary policy report to elucidate the causes of inflation and the speculations of inflation for 6-18 months ahead.
The committee incorporates 6 members-3 officials of the Reserve Bank of India and 3 external members appointed by the Government of India. These Members have to perceive a silent period of 7 days before and after the rate decisions for utmost discretion.
Monetary Policy Committee in India consists of 6 members - Shri Shaktikanta Das, Governor of RBI; Dr. Shashanka Bhide, Senior Advisor; Dr. Ashima Goyal, Emeritus professor; Prof. Jayanth R Verma, IIM Ahmedabad; Dr.Michael Debabrata Patra, Deputy Governor in charge of monetary policy and Dr. Mridul K. Saggar, Executive Director.
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