The Reserve Bank of India has decided to change the timing of announcing its policy review, due on October 4, to mid-afternoon.
With a new boss at its helm and the six-member Monetary Policy Committee’s two-day meeting set to take a decision on the repo rate, the RBI has recalibrated the way it communicates the monetary policy. The central bank on Friday said the six-member Monetary Policy Committee (MPC) will meet on October 3 and 4, for the fourth bi-monthly monetary policy review for 2016-17.
Breaking with the tradition of announcing the monetary policy in the morning, the RBI said the decision of the MPC will be placed on the Web site at 2.30 pm on October 4.
The MPC is entrusted with the task of fixing the benchmark policy rate (repo rate) required to contain inflation within the specified target level. The MPC has been constituted through an amendment to the Reserve Bank of India Act, 1934 (RBI Act) for maintaining price stability, while keeping in mind the objective of growth.
According to the government, a committee-based approach for determining the monetary policy will add lot of value and transparency to monetary policy decisions.
The meetings of the Monetary Policy Committee will be held at least four times a year and it will publish its decisions after each such meeting.
The government, in consultation with the RBI, has notified the inflation target (of 4 per cent, with upper and lower tolerance levels of 6 per cent and 2 per cent, respectively) in the Gazette of India Extraordinary for the period beginning August 5, 2016 to March 31, 2021.
Members of the MPC are — RBI Governor Urjit Patel; Deputy Governor (in charge of Monetary Policy) R Gandhi; an officer of the RBI to be nominated by its Central Board; Chetan Ghate, Professor, Indian Statistical Institute; Pami Dua, Director, Delhi School of Economics; and Ravindra H Dholakia, Professor, Indian Institute of Management, Ahmedabad.
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