Monetary Policy Committee (MPC)

Recently, the Monetary Policy Committee (MPC) decided to keep the repo rate unchanged at 6.50% for the 10th consecutive time.

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Key Highlights 

• Current Repo Rate: 6.50% 
• Repo Rate: The interest rate at which commercial banks borrow money from RBI.

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► Monetary Policy Committee

• It is a statutory body constituted under the RBI Act of 1934.
• The committee consists of six members; three are officials of the Reserve Bank of India, and three external members are nominated by the central government.
• Objective: To determine the repo rate and other macroeconomic indicators to achieve the inflation target.
• The MPC is chaired by the RBI Governor.
• Quorum: A minimum of four participants are required for the meeting.
• Each member of the committee has one vote, and in the case of an equality of votes, the Governor has a second or casting vote.
• Each member of the committee writes a statement defining the reasons for voting in favour of, or against the proposed resolution.
• The committee is supposed to meet every 2-2 months and is required to meet at least four times a year.
• Terms and Reappointment: Members of the committee will serve for four years and are not eligible for reappointment.