Monetary Policy: backbone of monetary stability
In February 2015 RBI and government of India signed the monetary policy framework agreement in would be a legal responsibility of RBI to manage both inflation and growth under a characteristics known as flexible inflation targeting. example 4 plus(+) minus(-) 2 where plus minus mean standard deviation. 4plus minus was introduced because in the past 100 years only those emerging economies enter in to group of developed economy which have manage their inflation in the band of management 2 to 6 percent. Earlier in the RBI Governor or monetary policy creator were not legally responsible for any breach of inflation targeting alter 2015 governor and monetary policy committee towards a parliamentary law to manage inflation with in the bond. Structure of monetary policy committee-6 member body RBI Governor is the chairman M.P.C, deputy governor is in charge of monetary policy. One member nominated by RBI board and 3 member are going to be nominated by G.O.I , RBI legal responsibility- to ...