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Monetary Policy Committee (MPC) has been instituted by the Central Government of India under Section 45ZB of the RBI Act that was amended in 1934. MPC had its first meeting for two days on October 3 and October 4, 2016. The MPC is entrusted with the responsibility of deciding the different policy rates including MSF, Repo Rate, Reverse Repo Rate, and Liquidity Adjustment Facility. Monetary Policy Committee (MPC) has six members and the main objective of this body is to maintain the price stability and boosting up the growth rate of the country’s economy. What is <keyword id="679958" type="ORGANIZATION" weightage="20" keywordseo="RBI-monetary-policy">RBI Monetary Policy</keyword> ? The term ‘Monetary Policy’ is the Reserve Bank of India’s policy pertaining to the deployment of monetary resources under its control for the purpose of achieving GDP growth and lowering the inflation rate. The Reserve Bank of India Act 1934 empowers the RBI to make the monetary policy. We can say that the monetary policy stands for the control measures adopted by the Central Bank of a nation. What the Monetary Policy intends to achieve? As per the suggestions made by Chakravarty Committee, aspects such as price stability, economic growth, equity, social justice, and encouraging the growth of new financial enterprises are some crucial roles connected to the monetary policy of India. While the Government of India tries to accelerate the GDP growth rate of India, the RBI keeps trying to bring down the rate of inflation within a sustainable limit. In order to achieve its main objectives, the Monetary Policy Committee determines the ideal policy interest rate that will help achieve the inflation target in front of the country. Monetary Policy Department (MPD) is an important organ of the Reserve Bank of India that assists the Monetary Policy Committee (MPC) in creating the monetary policy. Monetary Policy Committee Structure Monetary Policy Committee has 6 members as follows: <table style="border-width: initial; border-style: none;"> <tbody><tr> <td style="width: 40.25pt; border-width: 1pt; border-style: solid; border-color: windowtext; padding: 0cm 5.4pt;"> SI. No. </td> <td style="width: 94.5pt; border-top: 1pt solid windowtext; border-right: 1pt solid windowtext; border-bottom: 1pt solid windowtext; border-left-width: initial; border-left-style: none; padding: 0cm 5.4pt;"> Designation </td> <td style="width: 175.5pt; border-top: 1pt solid windowtext; border-right: 1pt solid windowtext; border-bottom: 1pt solid windowtext; border-left-width: initial; border-left-style: none; padding: 0cm 5.4pt;"> The office held </td> <td style="width: 157.25pt; border-top: 1pt solid windowtext; border-right: 1pt solid windowtext; border-bottom: 1pt solid windowtext; border-left-width: initial; border-left-style: none; padding: 0cm 5.4pt;"> Who holds the office as on October 2019 </td> </tr> <tr> <td style="width: 40.25pt; border-right: 1pt solid windowtext; border-bottom: 1pt solid windowtext; border-left: 1pt solid windowtext; border-top-width: initial; border-top-style: none; padding: 0cm 5.4pt;"> </td> <td style="width: 94.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Chair Person </td> <td style="width: 175.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Governor of the Reserve Bank of India </td> <td style="width: 157.25pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Shri Shaktikanta Das </td> </tr> <tr> <td style="width: 40.25pt; border-right: 1pt solid windowtext; border-bottom: 1pt solid windowtext; border-left: 1pt solid windowtext; border-top-width: initial; border-top-style: none; padding: 0cm 5.4pt;"> </td> <td style="width: 94.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Member, ex officio </td> <td style="width: 175.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Deputy Governor of the Reserve Bank of India, in charge of Monetary Policy </td> <td style="width: 157.25pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> BP Kanungo </td> </tr> <tr> <td style="width: 40.25pt; border-right: 1pt solid windowtext; border-bottom: 1pt solid windowtext; border-left: 1pt solid windowtext; border-top-width: initial; border-top-style: none; padding: 0cm 5.4pt;"> </td> <td style="width: 94.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Member, ex officio </td> <td style="width: 175.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> An officer of the Reserve Bank of India nominated by the Central Board </td> <td style="width: 157.25pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Dr. Michael Debabrata Patra </td> </tr> <tr> <td style="width: 40.25pt; border-right: 1pt solid windowtext; border-bottom: 1pt solid windowtext; border-left: 1pt solid windowtext; border-top-width: initial; border-top-style: none; padding: 0cm 5.4pt;"> </td> <td style="width: 94.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Member </td> <td style="width: 175.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Professor, Indian Institute of Management, Ahmedabad </td> <td style="width: 157.25pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Dr. Ravindra H. Dholakia </td> </tr> <tr> <td style="width: 40.25pt; border-right: 1pt solid windowtext; border-bottom: 1pt solid windowtext; border-left: 1pt solid windowtext; border-top-width: initial; border-top-style: none; padding: 0cm 5.4pt;"> </td> <td style="width: 94.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Member </td> <td style="width: 175.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Director, Delhi School of Economics </td> <td style="width: 157.25pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Professor Pami Dua </td> </tr> <tr> <td style="width: 40.25pt; border-right: 1pt solid windowtext; border-bottom: 1pt solid windowtext; border-left: 1pt solid windowtext; border-top-width: initial; border-top-style: none; padding: 0cm 5.4pt;"> </td> <td style="width: 94.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Member </td> <td style="width: 175.5pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Professor, Indian Statistical Institute (ISI) </td> <td style="width: 157.25pt; border-top-width: initial; border-style: none solid solid none; border-left-width: initial; border-bottom-width: 1pt; border-bottom-color: windowtext; border-right-width: 1pt; border-right-color: windowtext; padding: 0cm 5.4pt;"> Shri Chetan Ghate </td> </tr> </tbody></table> The ex- Officio members of the committee hold the office for a term of four years or until the next order, whichever happens earlier. Monetary Policy Instruments and how they are managed Monetary policy instruments are of two types namely qualitative instruments and quantitative instruments. The list of quantitative instruments include Open Market Operations, Bank Rate, Repo Rate, Reverse Repo Rate, Cash Reserve Ratio, Statutory Liquidity Ratio, Marginal standing facility and Liquidity Adjustment Facility (LAF). Qualitative Instruments refer to direct action, change in the margin money and moral suasion. The instruments listed above are managed and regulated as per the needs of the country’s economy. These instruments are effectively used in order to ensure the money supply in the economy so that the inflation rate is stabilized to realize economic growth.

Monetary Policy Committee (MPC) Of India: Its Purpose, Structure and Responsibilities

<keyword id="30067" type="General" weightage="90" keywordseo="rbi" source="Orion">RBI</keyword> Governor Shaktikanta Das-headed Monetary Policy Committee (MPC) started its three-day meeting on Monday amid expectations of a smaller 25 basis points rate increase or a pause on the rate hiking spree that started in May last year to check inflation. The decision of the six-member rate setting panel will be announced by the Governor on Wednesday. With retail inflation showing signs of moderation and remaining below the <keyword id="6354335" type="General" weightage="50" keywordseo="reserve-bank-of-india" source="Orion">Reserve Bank of India</keyword>'s 6 per cent upper tolerance level, and projected slowdown in GDP growth in the next fiscal starting April, experts are of the opinion that the central <keyword id="15308630" type="TOPIC" weightage="60" keywordseo="Bank" source="TOPIC" sourcekeytype="finance,investopedia" meta.keywordsubtype="null" meta.msid="93495953" meta.seopath="b/bank" meta.entityname="Bank" meta.hostid="153" meta.entityid="bank">bank</keyword> may only opt for a 25 basis points hike in the key interest rate. Another opinion is that the RBI may press the pause button on rate hike on Wednesday itself. "We expect the RBI to pause in February policy," <keyword id="6354731" type="DOMAIN" weightage="20" keywordseo="state-bank-of-india" botkeyword="" source="ET" sourcekeytype="COMPANY" meta.keywordsubtype="EQ" meta.aliasname="state bank of india" meta.entityname="State Bank of India" meta.entityid="11984" meta.seoname="state-bank-of-india">State Bank of India</keyword>'s Economic Research Department said in a report titled 'Prelude to MPC Meeting on Feb 6-8, 2023'. In the current rate cycle, it said that rate actions, both hikes and cuts, have been largely synchronised with actions of the monetary authorities in the developed nations. The stance, the <keyword id="13222" type="DOMAIN" weightage="20" keywordseo="sbi" botkeyword="" source="ET" sourcekeytype="COMPANY" meta.keywordsubtype="EQ" meta.aliasname="sbi" meta.entityname="State Bank of India" meta.entityid="11984" meta.seoname="state-bank-of-india">SBI</keyword> report said could continue to be withdrawal of accommodation, even as <keyword id="15316241" type="TOPIC" weightage="60" keywordseo="Liquidity" source="TOPIC" sourcekeytype="economy,investopedia" meta.keywordsubtype="null" meta.seopath="l/liquidity" meta.entityname="Liquidity" meta.hostid="153" meta.entityid="liquidity">liquidity</keyword> is close to neutral. "Even though the RBI could pause as it allows past rate actions to work with long and variable lags, the RBI could still guide the markets with a rate action in future that will be purely data dependent," it said. According to the report, 6.25 per cent <keyword id="15378998" type="TOPIC" weightage="60" keywordseo="Repo-Rate" source="TOPIC" sourcekeytype="economy,budget,investopedia" meta.keywordsubtype="null" meta.seopath="r/repo-rate" meta.entityname="Repo Rate" meta.hostid="153" meta.entityid="repo-rate">repo rate</keyword> could be the terminal rate for now. In its December monetary policy review, the central bank raised the key <keyword id="15316469" type="TOPIC" weightage="60" keywordseo="Benchmark" source="TOPIC" sourcekeytype="mutual-fund,investopedia" meta.keywordsubtype="null" meta.seopath="b/benchmark" meta.entityname="Benchmark" meta.hostid="153" meta.entityid="benchmark">benchmark</keyword> interest rate (repo) by 35 basis points (bps) after delivering three back-to-back increases of 50 bps. Since May last year, the RBI has increased the short-term lending rate by 225 basis points to contain inflation, mostly driven by external factors, especially global <keyword id="15312689" type="TOPIC" weightage="60" keywordseo="Supply" source="TOPIC" sourcekeytype="economy,investopedia" meta.keywordsubtype="null" meta.msid="93027566" meta.seopath="s/supply" meta.entityname="Supply" meta.hostid="153" meta.entityid="supply">supply</keyword> chain disruption following the Russia-Ukraine war outbreak. Madan Sabnavis, Chief Economist at <keyword id="6358007" type="DOMAIN" weightage="20" keywordseo="bank-of-baroda" botkeyword="" source="ET" sourcekeytype="COMPANY" meta.keywordsubtype="EQ" meta.aliasname="bank of baroda" meta.entityname="Bank of Baroda" meta.entityid="12040" meta.seoname="bank-of-baroda">Bank of Baroda</keyword>, said the <keyword id="15313867" type="TOPIC" weightage="60" keywordseo="Credit" source="TOPIC" sourcekeytype="finance,investopedia" meta.keywordsubtype="null" meta.msid="92548261" meta.seopath="c/credit" meta.entityname="Credit" meta.hostid="153" meta.entityid="credit">credit</keyword> policy will be announced against the background of both the Budget that was presented as well as the Economic Survey that served as the prelude to it. The Budget has maintained a virtually unchanged borrowing programme while the Survey has pointed to the persistence of higher interest rates in the coming year. While inflation has been trending downwards, there has been a tendency for <keyword id="15376162" type="TOPIC" weightage="60" keywordseo="Core-Inflation" source="TOPIC" sourcekeytype="investopedia" meta.keywordsubtype="null" meta.seopath="c/core-inflation" meta.entityname="Core Inflation" meta.hostid="153" meta.entityid="core-inflation">core inflation</keyword> to remain sticky. Inflation has come down mainly due to lower food inflation which can be volatile. Also, the decision taken this time cannot be reversed soon, he said. "Under these conditions, the RBI will pitch for another 25 bps hike in the repo rate which will be the last in this cycle, and then pause. The stance however may change from the withdrawal of accommodation to neutral as liquidity is no longer in a large surplus. In fact, based on developments that take place, there may be need to infuse liquidity during the course of the year," Sabnavis opined. The RBI has been tasked to ensure that retail inflation remains at 4 per cent with a margin of 2 per cent. However, it failed to keep the inflation rate below six per cent for three consecutive quarters beginning January 2022. However, the retail inflation based on the Consumer Price Index (CPI) has shown signs of moderation in November and December as it fell below the RBI's upper tolerance level of 6 per cent. The MPC consists of three RBI officials and three external members appointed by the central government. The external members are Shashanka Bhide (Honorary Senior Advisor, National Council of Applied Economic Research, Delhi); Ashima Goyal (Emeritus Professor, Indira Gandhi Institute of Development Research, Mumbai); and Jayanth R Varma (Professor, Indian Institute of Management, Ahmedabad). Apart from the Governor, the RBI officials on the panel are Rajiv Ranjan (Executive Director) and Michael Debabrata Patra (Deputy Governor). SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/gold-plunges-574-silver-plummets-2113-amid-weak-global-trends/articleshow/97644748.cms">Gold plunges ₹574, silver plummets ₹2,113 amid weak global trends</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/banks/news/bandhan-bank-hikes-interest-rates-on-fixed-deposits/articleshow/97646005.cms">Bandhan Bank hikes interest rates on fixed deposits</a>

RBI's Monetary Policy Committee meeting starts amid expectations of lower rate hike

Will there be unanimity amongst the members of the Reserve Bank of India's (<keyword id="30067" type="General" weightage="20" keywordseo="RBI" source="Orion">RBI</keyword>) <keyword id="6375120" type="General" weightage="20" keywordseo="Monetary-Policy-Committee" source="Orion">Monetary Policy Committee</keyword> (MPC) on the decisions to be taken at their <keyword id="15379699" type="General" weightage="20" keywordseo="November-3-meeting" source="Orion">November 3 meeting</keyword> is the question that pops up. The reason being that at the MPC meeting held in September, one member voted against the resolution hiking the repo rate by 50 basis points to 5.90 per cent. And in the August meeting too there were differences of views on the resolution that was passed. "Even at the upcoming meeting each one will have a view which will be considered by the RBI is what I believe. That will be put in the letter to the Central Government," a senior economist told IANS preferring anonymity. The RBI has scheduled the November 3 meeting of MPC under Section 45ZN of the RBI Act. As per the said Section, when the RBI fails to meet the inflation target, it shall send a report to the Central government listing: (a) the reasons for failure to achieve the inflation target; (b) remedial actions proposed to be taken by it; and (c) an estimate of the time-period within which the inflation target shall be achieved pursuant to timely implementation of proposed remedial actions. The MPC at its upcoming meeting will discuss what it would tell the Centre as to why it was not able to restrain the inflation. The RBI may also sound out the Central government as to the course of inflation as well as the reasons as to why it may be at the elevated levels. In India, the retail inflation rose to 7.41 per cent in September. At the MPC meeting held in September, Dr. Ashima Goyal voted against the resolution to hike the repo rate by 50 basis points to 5.90 per cent. Goyal was for a hike of 35 basis points and explaining his reasons voted against the resolution. However, the resolution was passed by a 5:1 majority. At the same meeting, another member Prof. Jayanth R. Varma voted against the second part of the resolution on the withdrawal of accommodation to ensure inflation remains within the target. Varma said the MPC should now pause rather than focus on further tightening . On the issue of upward rate revision, he was for upward revision by 60 basis points instead of 50 basis points that was proposed. As the difference between the two was only marginal Varma voted in favour. RBI Governor Shaktikanta Das had said the communication with the central government is a privileged one and it will not be made public by the Bank. However as per Section 45ZL of the RBI Act, the minutes of the MPC meeting has to be published. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/news/global-smartphone-market-sinks-to-lowest-q3-level-since-2014/articleshow/95163037.cms" style="">Global smartphone market sinks to lowest Q3 level since 2014</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/rbi-can-argue-its-case-on-inflation-control-say-experts/articleshow/95158091.cms" style="">RBI can argue its case on inflation control say experts</a>

Will the views of RBI MPC members converge or diverge at Nov 3 meeting?

Mumbai (Maharashtra) [India], April 5 (ANI): <keyword id="19899810" type="General" weightage="20" keywordseo="reserve-bank-of-india" source="keywords">Reserve Bank of India</keyword> Governor Shaktikanta Das will announce the outcome of the first <keyword id="6375120" type="General" weightage="20" keywordseo="Monetary-Policy-Committee" source="Orion">Monetary Policy Committee</keyword> (MPC) meeting of the financial year 2024-2025 on Friday. The central banking authority of India has kept the <keyword id="43352" type="General" weightage="20" keywordseo="repo-rate" source="Orion">repo rate</keyword> unchanged for the last six consecutive MPC meetings and according to experts it is likely to maintain the status quo on interest rates this time too. The repo rate, is the interest rate at which banks draw funds from <keyword id="30067" type="General" weightage="20" keywordseo="RBI" source="Orion">RBI</keyword> to overcome short-term liquidity mismatches. Monetary Policy Committee was constituted under the Reserve Bank of India Act, 1934. MPC is a six-member committee comprising three members from RBI including Governor Shaktikanta Das and three members appointed by the Central government. The two-day review meeting of the MPC that commenced on April 3 concludes today. The RBI had maintained the status quo on policy rates and stances in its last review, which was held in February 2024. The decision however was not unanimous and one member has recommended a rate cut of 25 basis points and policy change stand to neutral. Since the last policy, rating agencies have revised India's growth forecast upwards. <keyword id="7706673" type="General" weightage="20" keywordseo="Finance-Minister-Nirmala-Sitharaman" source="Orion">Finance Minister Nirmala Sitharaman</keyword>, recently said that India will grow over 8 per cent in FY24. Inflation has dropped and has remained under the range of comfort zone. Consumer Price Index inflation was 5.1 per cent in February 2024, up from over 5.5 per cent in December 2023. The core CPI inflation, excluding food and beverages, was at a low of 3.5 per cent in February 2024. However, food inflation at above 7 per cent was a concern, but with a recent cut in the prices of petrol, diesel and LPG, it is likely to further fall in March and may come below 5 per cent. Meanwhile, the India Meteorological Department's (IMD) recent announcement of above-normal temperatures during April-June may be a concern regarding rise in prices of vegetable, fruits and other perishable items. Also prices of rice, pulses have shown an upward trend which may be a concern for the MPC while taking a decision. However, softening prices of non-food items will give some relief to the committee. Generally, normal monsoons follow above normal temperatures, presuming that the average CPI inflation is likely to be in the RBI's comfort zone of 4-6 per cent in FY25. According to official data, retail inflation in India eased a tad in February to 5.09 per cent from 5.10 per cent the prior month, due to the deceleration of prices in all categories except food. Experts believe that the RBI is unlikely to change its policy stance before the August 2024 MPC review and any rate cut is unlikely before that. The US Fed has also recently indicated that it is not in a hurry to cut rates. All these suggest that the RBI, too, is unlikely to go for a rate cut before the October 2024 policy. The next MPC meetings of the RBI have been scheduled this year for June, August, October, December and February 2025.

RBI Monetary Policy Meeting: Central Bank likely to keep rates steady

Government has appointed three academics as members of interest-rate setting <keyword id="6375120" type="ORGANIZATION" weightage="20" keywordseo="monetary-policy-committee">Monetary Policy Committee</keyword> - Indian Statistical Institute professor <keyword id="6638266" type="UNKNOWN" weightage="20" keywordseo="Chetan-Ghate">Chetan Ghate</keyword>, Delhi School of Economics director <keyword id="3678398" type="PERSON" weightage="20" keywordseo="Pami-Dua">Pami Dua</keyword> and Ravindra H Dholakia of IIM-Ahmedabad. 
 
The three experts have been appointed for a period of four years. We will tell you all about the three academicians in a slideshow below, but before that here’s a little bit about the other members who will be a part of the committee. 
 The other three members will come from the Reserve Bank of India and will include <keyword id="30067" type="ORGANIZATION" weightage="20" keywordseo="RBI">RBI</keyword> Governor <keyword id="6375119" type="UNKNOWN" weightage="20" keywordseo="Urjit-Patel">Urjit Patel</keyword>, Deputy Governor R. Gandhi, who is in charge of the monetary policy, and Executive Director Michael Patra. Urjit Patel will have a casting vote in case of a tie in the six-member committee. 
 
Setting up of the panel will bring about a landmark change to how central bank decisions are made in the country. It represents a marked change to monetary policy, which was previously decided solely by the RBI Governor. Instead, the Monetary Policy Committee will now strive to ensure that the inflation target decided by the government and the central bank is met. The RBI has the mandate to contain retail inflation within a band of 4%, plus or minus 2 percentage points. 
 
The MPC is slated to sit for its first monetary policy review on 4 October. 
 
Now, more about the academicians who will be deciding the Monetary Policy of India:

These 3 Professors are in the team that will decide India's Monetary Policy

<keyword id="1334" type="General" weightage="80" keywordseo="china" source="Orion">China</keyword> has announced a price war on Elon Musk-run <keyword id="6360701" type="General" weightage="100" keywordseo="spacex" source="Orion">SpaceX</keyword>, with doubling down on reusable rockets as part of its new aerospace programme. A new aerospace launching system is under development in China that requires cutting the cargo cost per kilogram to 5 per cent to that of the existing Long March rockets, reports South China Morning Post. "The Long-Range Aerospace Transportation System, being built at the China Aerospace Science and Technology Corporation (CASC), the nation's largest aerospace defence contractor, can carry more than 60 tonnes of cargo to near-Earth orbit - about the same capacity as SpaceX's Falcon Heavy rocket," the report mentioned. The hypersonic space plane could deliver the same payload from Shanghai to an airport in San Francisco in less than an hour. According to project lead scientist <keyword id="10476941" type="General" weightage="50" keywordseo="song-zhengyu" source="Orion">Song Zhengyu</keyword> of the China Academy of Launch Vehicle Technology, space authorities require the plane to be reused more than 100 times and have fewer than three failures per 1,000 flights. In recent years, SpaceX has also cut its launch cost to about the same as that of the Long March rockets. China also plans to launch nearly 13,000 internet satellites to counter SpaceX's Starlink. Meanwhile, China recently carried out a successful rocket vertical landing test at sea. The technology would lay the foundation for future applications including a recyclable near-space experiment platform as well as the development of space travel, reports state-run Global Times. CAS Space, a commercial spaceflight firm that is partly owned by CAS, revealed that it successfully carried out the launching-from-land and landing-at-sea flight trial in Haiyang, East China's Shandong Province. "The rocket prototype flew at an altitude of more than 1,000 metres, descended in a smooth hovering fashion and then decelerated thanks to the engine reverse thrust," the report mentioned. SEE ALSO: <a href="https://www.businessinsider.in/finance/news/rbi-revises-indias-fy24-growth-outlook-expects-softer-inflation-on-the-back-of-lower-commodity-prices/articleshow/99290005.cms">RBI revises India’s FY24 growth outlook, expects softer inflation on the back of lower commodity prices</a> <a href="https://www.businessinsider.in/finance/news/rbis-monetary-policy-committee-keeps-repo-rate-unchanged-at-6-5/articleshow/99284354.cms">RBI’s Monetary Policy Committee keeps repo rate unchanged at 6.5%, for now</a> <a href="https://www.businessinsider.in/stock-market/news/after-the-ides-of-march-analysts-pick-best-stocks-that-can-be-bought-on-dips/articleshow/99272438.cms">After the Ides of March, analysts pick best stocks that can be bought on dips</a>

China wages price war on Musk's SpaceX reusable rockets

Mumbai, The rupee witnessed a rebound in early trade on Thursday and appreciated 11 paise to 83.42 against the US dollar, supported by positive domestic equities. Elevated crude oil prices and sustained foreign fund outflows also dented investor sentiments, forex traders said. Moreover, market participants remained cautious ahead of the <keyword id="19922074" type="General" weightage="20" keywordseo="reserve-bank" source="keywords">Reserve Bank</keyword>'s rate-setting panel's decision to be announced on Friday, traders said, At the interbank foreign exchange market, the local unit opened at 83.44 against the greenback. The unit hit an intraday low of 83.45 and a high of 83.42 against the greenback, higher 11 paise from its previous close. On Wednesday, the rupee depreciated 11 paise to close at 83.53 against the US dollar. According to Anil Kumar Bhansali, Head of <keyword id="19900042" type="General" weightage="20" keywordseo="treasury" source="keywords">Treasury</keyword> and Executive Director, Finrex Treasury Advisors LLP, market participants await the RBI MPC policy decision for further cues. The Reserve Bank's rate-setting panel on Wednesday started its three-day deliberations on the next set of monetary policy. The decision taken at the meeting of the Reserve Bank Governor Shaktikanta Das-headed <keyword id="19913109" type="General" weightage="20" keywordseo="monetary-policy-committee" source="keywords">Monetary Policy Committee</keyword> (MPC) will be announced on Friday (April 5). Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.05 per cent lower at 104.19. Brent crude futures, the global oil benchmark, rose 0.29 per cent to USD 89.61 per barrel. On the domestic equity market front, <keyword id="19896382" type="General" weightage="20" keywordseo="sensex" source="keywords">Sensex</keyword> advanced 195.66 points, or 0.26 per cent, to 74,072.48 points. The <keyword id="19896381" type="General" weightage="20" keywordseo="nifty" source="keywords">Nifty</keyword> rose 45.05 points, or 0.2 per cent, to 22,479.70 points. Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Wednesday as they offloaded shares worth Rs 2,213.56 crore, according to exchange data.

Rupee rebounds in early trade, rises 11 paise to 83.42/USD

<ul><li>Contrary to market expectations, the <keyword id="6375120" type="COMPANY" weightage="20" keywordseo="monetary-policy-committee">monetary policy committee</keyword> of the <keyword id="30067" type="ORGANIZATION" weightage="20" keywordseo="RBI">RBI</keyword> kept the <keyword id="102335" type="ORGANIZATION" weightage="20" keywordseo="Repo">repo</keyword> rate unchanged at 6.5%. </li><li>Given the falling rupee and higher fuel prices, It was widely expected that the central bank would hike the repo rate to 6.75% to keep <keyword id="22195" type="COMPANY" weightage="20" keywordseo="Inflation">inflation</keyword> in check. </li><li>In anticipation of a rate hike, banks like SBI and HDFC increased borrowing rates while fund managers increased their cash holdings. </li></ul>After two consecutive rate hikes of 25 basis points, the monetary policy committee of the Reserve Bank of India (RBI) surprised market pundits by keeping the <a href="https://rbidocs.rbi.org.in/rdocs/PressRelease/PDFs/PR795F23744EF408341E18684D24B464FADDF.PDF">repo rate on hold</a> at its meeting on 5 October. This is the rate at which it lends money to domestic banks. Given the falling rupee and higher fuel prices, it was widely expected that the central bank would hike the repo rate from 6.5% to 6.75% to keep inflation in check. This would have marked the strongest tightening cycle since 2013. In anticipation of a rate hike, banks like SBI and HDFC increased borrowing rates while fund managers increased their cash holdings. The monetary policy committee probably decided against the rate hike for two reasons. Firstly, it ascertained that inflation was in a manageable range given the recent decline in food prices. Secondly, three consecutive rate hikes would have significantly dampened demand for loans, translating to a slowdown in investment and economic activity. However, there will likely be further rate increases ahead. The RBI did change its stance from “neutral” to hawkish, explaining that it would focus on the “calibrated tightening of monetary policy” in order to ensure headline inflation did not exceed its 4% target by more than 2%. As things stand, inflation is expected to touch 4.5% by the end of the current fiscal year. Despite internal and external pressures on the Indian economy, the central bank retained its growth forecast of 7.4% for 2018-19 and 7.6% for 2019-20. Rupee goes past 74 The market did not react well to the RBI’s decision. The rupee, which was trading at 73.81 to the US dollar by the end of 4 October, crashed below 74. The rupee has been in freefall in the year so far owing to capital outflows as foreign investors rerouted funds from emerging markets like India to safe havens like the US, where the Federal Reserve is tightening rates. Meanwhile, the Sensex, an index of 30 strong companies on the Bombay Stock Exchange, has fallen by nearly 800 points following the RBI’s announcement. The repo rate hike would have made <keyword id="6371181" type="UNKNOWN" weightage="20" keywordseo="interest-rates">interest rates</keyword> more attractive for foreign investors, which would have helped in the accumulation of capital inflows.

Reserve Bank of India surprises all by keeping interest rates unchanged

<ul><li><keyword id="4667782" type="General" weightage="80" keywordseo="sabnavis" source="Orion">Sabnavis</keyword> said it believes that the terminal repo rate for the financial year is expected to be 6.5 per cent.</li><li>An out-of-turn meeting of the <keyword id="6375120" type="General" weightage="50" keywordseo="monetary-policy-committee" source="Orion">Monetary Policy Committee</keyword> (MPC) of the Reserve Bank of India was held in early November.</li><li><keyword id="30067" type="General" weightage="100" keywordseo="rbi" source="Orion">RBI</keyword> had already hiked the key policy rate by 190 basis points since May to 5.9 per cent to cool off domestic retail inflation.</li></ul> The Reserve Bank of India's three-day monetary policy committee meeting commences today. Financial markets will be keenly watching the committee's stance as consumer inflation is still above the 6 per cent target band. "The RBI will be presenting the monetary policy against the backdrop of GDP growth slowing down as well as inflation being high above 6 per cent. We do believe that the MPC will continue with rate hikes this time though the magnitude will be lower - probably 25-35 bps," said <keyword id="170005" type="General" weightage="50" keywordseo="madan-sabnavis" source="Orion">Madan Sabnavis</keyword>, Chief Economist at <keyword id="6358007" type="General" weightage="50" keywordseo="bank-of-baroda" source="Orion">Bank of Baroda</keyword>. More specifically, Sabnavis said it believes that the terminal repo rate for the financial year is expected to be 6.5 per cent, which essentially means there will be one more rate hike in February meeting. "It is unlikely to change the stance and the withdrawal of liquidity will continue. While the RBI will take a hard look at both the GDP and inflation projections, there could be some downward revision for GDP growth. In short, there will not be any surprise for the market just as is the case for global markets too which are now expecting more moderate increases in interest rates by the <keyword id="45672" type="General" weightage="50" keywordseo="fed" source="Orion">Fed</keyword>," Sabnavis added. The central bank had already hiked the key policy rate by 190 basis points since May to 5.9 per cent to cool off domestic retail inflation that has stayed above the RBI's upper tolerance limit for over three quarters now. In October, retail inflation was 6.77 per cent. Under the flexible inflation targeting framework introduced in 2016, the RBI is deemed to have failed in managing price rises if the CPI-based inflation is outside the 2-6 per cent range for three quarters in a row. An out-of-turn meeting of the Monetary Policy Committee (MPC) of the Reserve Bank of India was held in early November to discuss and draft the report to be sent to the central government for having failed in maintaining the inflation mandate. The meeting was called under Section 45ZN of the Reserve Bank of India (RBI) Act 1934, which pertains to steps to be taken if the central bank fails to meet its inflation-targeting mandate. Further details about the special meeting are not officially in the public domain. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/more-to-be-expected-from-rbis-mpc-meeting-than-just-a-rate-hike-say-experts/articleshow/95991628.cms">More to be expected from RBI's MPC meeting than just a rate hike say experts</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/science/health/news/canada-overwhelmed-with-tridemic-of-covid-19-flu-and-respiratory-syncytial-virus/articleshow/95990833.cms">Canada overwhelmed with 'tridemic' of Covid-19, flu and respiratory syncytial virus</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/jio-haptik-aims-to-turn-profitable-before-listing/articleshow/95975823.cms">With an eye on listing in the future, Jio Haptik trains guns on growth &amp; profitability</a>

Bank of Baroda expects 25-35 basis points rate hike from Dec 5-7 RBI policy meet

<ul class="summary-list"><li><keyword id="106488" type="CITY" weightage="60" keywordseo="Bank-of-England">Bank of England</keyword> policymakers kept <keyword id="6371181" type="UNKNOWN" weightage="60" keywordseo="interest-rates">interest rates</keyword> at 0.1% and left bond purchases intact on Thursday.</li><li>The <keyword id="6375120" type="ORGANIZATION" weightage="60" keywordseo="monetary-policy-committee">Monetary Policy Committee</keyword> expects the recent jump in <keyword id="22195" type="COMPANY" weightage="60" keywordseo="Inflation">inflation</keyword> to be transitory.</li><li>MPC members predict UK GDP will recover to pre-pandemic levels next quarter.</li></ul>Bank of England policymakers have decided against paring back their efforts to stimulate the UK <keyword id="34412" type="ORGANIZATION" weightage="60" keywordseo="economy">economy</keyword>, as they expect the recent spike in inflation to be transitory.The central bank's Monetary Policy Committee <a href="https://www.bankofengland.co.uk/monetary-policy-report/2021/august-2021">voted</a> unanimously to keep the bank rate at 0.1% and by 7-1 to maintain total bond purchases at £895 billion ($1.25 trillion), the BOE said Thursday. The MPC acknowledged there is upward pressure on global prices as economies reopen and supply crunches continue. However, it expects those pressures to prove temporary, and it predicts inflation won't remain elevated for long.The committee's members expect UK GDP growth to fall to 3% this quarter from an estimated 5% in the second quarter, and they predict GDP will rebound to pre-pandemic levels in the fourth quarter of this year. They also forecast that Consumer Price Index inflation will reach 4% in the fourth quarter of this year, well above their 2% target. UK inflation surged to 2.5% in June, the highest reading in almost three years.The BOE policymakers said that "modest tightening" of monetary policy will likely be necessary to meet inflation targets in the medium term.The<a href="https://markets.businessinsider.com/currencies/gbp-usd?utm_source=markets&amp;utm_medium=ingestgest" target="_blank" rel="noopener"> pound</a> ticked higher against the dollar after the announcement, but has been wavering lower and was at $1.3922 at last check.This latest decision suggests the central bank's members are far more concerned with supporting the UK economy's recovery from the <keyword id="43587" type="ORGANIZATION" weightage="60" keywordseo="pandemic">pandemic</keyword> than tamping down inflation, at least for now. Surging demand for products such as lumber, used cars, and furniture, coupled with disruptions to supply chains, has driven the prices of several products to <a href="https://www.businessinsider.com/price-increase-everything-getting-more-expensive-gas-cars-groceries-inflation-2021-7">stratospheric levels</a> in recent months.

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China wages price war on Musk's SpaceX reusable rockets

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Rupee rebounds in early trade, rises 11 paise to 83.42/USD

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Bank of Baroda expects 25-35 basis points rate hike from Dec 5-7 RBI policy meet

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The Bank of England stands by its stimulus plans, dismissing the inflation spike as transitory

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