Monetary Policy Committee

• MPC has decided unanimously to keep the policy repo rate unchanged at 6.50 per cent.
• By pausing, the RBI is trying to ensure that India’s financial system does not suffer the kind of crises seen by banking collapses in the US and Europe.

About Monetary Policy Committee (MPC)

• The Monetary Policy Committee (MPC) is a committee of the Reserve Bank of India, headed by its Governor, which is entrusted with the task of fixing the benchmark policy interest rate (repo rate) to contain inflation within the specified target level.
• It was constituted in 2016 under Section 45ZB of RBI Act 1934.
• There are a total of six members in the committee, three members are from RBI itself and the rest of them are appointed by the Government of India.
• The MPC consists of six members:
  • RBI Governor (Chairperson)
  • RBI Deputy Governor in charge of monetary policy,
  • One official nominated by the RBI Board
  • The Government of India will propose three members [committee chaired by the Cabinet Secretary].
  • Members of the MPC will serve for four years and are not eligible for reappointment.
• MPC is required to meet at least four times in a year.
• The quorum for the meeting is four members.