Q. Consider the following statements regarding the Monetary Policy Committee (MPC):
1.It is a statutory body.
2.It was constituted the recommendations of the R
3.Its main objective is to set the repo rate to achieve the inflation target set by the government. Which of the statements given above are correct?
Answer: C
Notes:
Explanations –
Statements 1 and 3 are correct. The Monetary Policy Committee (MPC) is a statutory body established under the Reserve Bank of India Act, 1934 (amended in 2016). The primary objective of the MPC is to determine the repo rate to achieve the inflation target set by the Government of India in consultation with the RBI. The inflation target is currently set at 4% ± 2% (i.e., 2% to 6%) under the flexible inflation targeting (FIT) framework.
Statement 2 is incorrect. The MPC was constituted based on the recommendations of the Urjit Patel Committee (2014).
Source: AIR
