GyanGramWhich of the following statements is/are correct regarding the Monetary Policy Committee (MPC)? 1. It decides…
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Which of the following statements is/are correct regarding the Monetary Policy Committee (MPC)?
1. It decides the RBI’s benchmark interest rates.
2. It is a 12-member body including the Governor of RBI and is reconstituted every year.
3. It functions under the chairmanship of the Union Finance Minister.
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• Correct Answer: A
• MPC is a statutory body under the RBI Act, 1934 that determines the benchmark policy repo rate to achieve inflation targets.
• It is a 6-member body (3 from RBI + 3 government appointees), not 12, chaired by the RBI Governor, not the Finance Minister.
• Statements 2 and 3 are factually incorrect.
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