Faculty of GA&GS in Delhi Since 2010.Selected in LIC(ADO),BankPO,CGL,2 Times Mains in CSE,Founder:-GovtJobsAcademy @Youtube/Telegram/FB/Web.

Vikas Kumar Singh Tomar

You might have heard of the term Monetary Policy in Economy class. Recently there were many changes in the way Monetary Policy of India is formed – with the introduction of Monetary Policy Framework (MPF), Monetary Policy Committee (MPC), and Monetary Policy Process (MPP).
ired to maintain in safe and liquid assets, such as unencumbered government securities, cash and gold. Changes in SLR often influence the availability of resources in the banking system for lending to the private sector.
Open Market Operations (OMOs): These include both, outright purchase and sale of government securities, for injection and absorption of durable liquidity, respectively.
Market Stabilisation Scheme (MSS): This instrument for monetary management was introduced in 2004. Surplus liquidity of a more enduring nature arising from large capital inflows is absorbed through the sale of short-dated government securities and treasury bills. The cash so mobilised is held in a separate government account with the Reserve Bank.

Discover, Learn and Master all the tricks and strategy to demolish the Banking examination and achieve your goal with flying colours

Bank Exams

Hindi

(Hindi )Monetary Policy or Credit Policy of RBI and Its Components or Tools for BANKS/SSC etc.

RBI - Preparation Strategy

Preparation Strategy

Practice and Strategy

Bank, SSC & Railway Exams

Ace the toughest competitive and government exams in India 

Test Preparation

Preparation Strategy for RBI Grade B 

RBI works as the monetary authority of India and there by operates the monetary policy. RBI deals with almost all other vital topics such as financial stability, financial markets, interest rates, credit delivery, regulatory norms, financial inclusion and institutional developments etc.

Introduction of Monetary Policy or Credit Policy Nd Why it’s Required For Any Country ? (in Hindi)

Monetary policy is the Macroeconomic Policy laid down by the central bank of the country. It refers to the use of instruments under the control of the central bank to regulate the availability, cost and use of money and credit.  It involves management of money supply and interest rate and is the demand side economic policy used by the government of a country to achieve macroeconomic objectives like inflation, consumption and growth.

In India, monetary policy of the Reserve Bank of India (RBI) is aimed at managing the quantity of money in order to meet the requirements of different sectors of the economy and to increase the pace of economic growth.

The goals of Monetary Policy:

Primarily price stability, while keeping in mind the objective of growth.
In India, subsequent to the recommendations of the Dr. Urjit Patel Committee Report, the Reserve Bank has formally announced a “glide path” for disinflation that sets an objective of below 8 per cent CPI inflation by January 2015 and below 6 per cent CPI inflation by January 2016.
The Reserve Bank’s Monetary Policy Department (MPD) assists the Governor in formulating the monetary policy. 

Instruments of Monetary Policy 

There are several direct and indirect instruments that are used in the implementation of monetary policy.

Cash Reserve Ratio (CRR): The share of Net Demand and Time Liabilities (deposits) that banks must maintain as cash balance with the Reserve Bank.
Statutory Liquidity Ratio (SLR): The share of Net Demand and Time Liabilities (deposits) that banks must maintain in safe and liquid assets, such as, government securities, cash and gold.
Refinance facilities: Sector-specific refinance facilities aim at achieving sector specific objectives through provision of liquidity at a cost linked to the policy repo rate.

All About CRR,SLR and Refinance Facility [DIRECT INSTRUMENTS] of Monetary Policy Of RBI (in Hindi)

Liquidity Adjustment Facility (LAF):  LAF is a monetary policy tool which allows banks to borrow money through repurchase agreements. LAF is used to aid banks in adjusting the day to day mismatches in liquidity. LAF has two components -- repo and reverse repo. Repo or repurchase option is a collaterised lending i.e. banks borrow money from RBI to meet short term needs by selling securities to RBI with an agreement to repurchase the same at predetermined rate and date. The rate charged by RBI for this transaction is called the repo rate.  Repo operations therefore inject liquidity into the system.
Reverse repo operation is when RBI borrows money from banks by lending securities. The interest rate paid by RBI is in this case is called the reverse repo rate. Reverse repo operation therefore absorbs the liquidity in the system.

All About REPO RATE and REVERSE REPO RATE {LAF-Liquidity Adjusted Facility} Monetary Policy Of RBI

Marginal Standing Facility (MSF): 
It refers to the penal rate at which banks can borrow money from the central bank over and above what is available to them through the LAF window. MSF, being a penal rate, is always fixed above the repo rate. The scheme has been introduced by RBI with the main aim of reducing volatility in the overnight lending rates in the inter-bank market and to enable smooth monetary transmission in the financial system. MSF came into effect from 9th May 2011. MSF scheme is provided by RBI by which the banks can borrow overnight upto 1 per cent of their net demand and time liabilities (NDTL) i.e. 1 per cent of the aggregate deposits and other liabilities of the banks. However, with effect from 17th April 2012 RBI has raised the borrowing limit under the MSF from 1 per cent to 2 per cent of their NDTL outstanding at the end of the second preceding fortnight. The rate of interest for the amount accessed through this facility is fixed at 1 per cent above the repo rate for all scheduled commercial banks.
Bank Rate: It is the rate at which the Reserve Bank is ready to buy or rediscount bills of exchange or other commercial papers. This rate has been aligned to the MSF rate and, therefore, changes automatically as and when the MSF rate changes alongside policy repo rate changes.

All About BANK RATE and MSF {Marginal Standing Facility} of Monetary Policy Of RBI (in Hindi)

Market Stabilisation Scheme (MSS): This instrument for monetary management was introduced in 2004. Surplus liquidity of a more enduring nature arising from large capital inflows is absorbed through sale of short-dated government securities and treasury bills.
Starting with the first bi-monthly statement of monetary policy in April 2014, the Reserve Bank has changed the normal frequency of monetary policy announcements from eight times in a year (i.e., four quarterly and four mid- quarter) to six times in a year (i.e., bi-monthly). Open Market Operations (OMOs): Buying and selling of government securities is as Open market operations. (For injection/absorption of liquidity in the market)

All About OMO [Open Market Operations] and Term Repo of Monetary Policy Of RBI

In India, the monetary policy is responsibility of RBI. RBI regulates the currency and credit system to secure the monetary stability in India. The main objectives of the monetary policy in India are to maintain the price stability, securing the financial stability and to ensure the adequate flow of credit.
System Before MPC
Before establishment of Monetary Policy Committee, the final decision on interest rates etc. would come from RBI Governor’s desk. Though there was a Technical Advisory Committee (TAC) comprising of governor as its chairman, the deputy governor as its vice-chairman and other 3 deputy governors to decide on monetary policy yet, the Governor had overriding powers upon the decision making process. The TAC was advisory in nature and there was no voting system there.
Recommendations For MPC
Strong recommendations to set monetary policy committee in India had come from Urjit Patel panel report. Prior to this, the B N Srikrishna headed Financial sector legislative reforms Commission (FSLRC) had also suggested framing a MPC to meet the challenge of the growing complex economy.
Setting up of MPC
The Monetary Policy Committee was set up in 2015 after amending the RBI Act. Before that, Government and RBI made an agreement via which Government tasked RBI with the responsibility for price stability and inflation targeting. In context, a Monetary Policy Framework Agreement was signed on February 20, 2015.
Composition of MPC
Monetary Policy Committee is an executive body of 6 members. Of these, three members are from RBI while three other members are nominated by the Central Government. Each member has one vote. In case of a tie, the RBI governor has casting vote to break the tie. MPC is required to meet for two days before deciding on rates. Further, it is needed to meet at least four times a year and make public its decisions following each meeting.
Current {October 2016} members of MPC are as follows:
RBI Members
Urjit Patel {RBI Governor}
R Gandhi {Deputy Governor Incharge of Monetary Policy}
Machael Patra {RBI Executive Director}
Government Nominated Members
Chetan Ghate, Pami Dua and Ravindra H Dholakia {all of them are esteemed academicians, they will hold office for four years}
Mandate of MPC
The core mandate of MPC is to fix the benchmark policy interest rate {Repo Rate} to contain inflation within the target level. In that context, RBI is mandated to furnish necessary information to the MPC to facilitate its decision. Government also, if wishes to convey its views, can do so in writing to MPC.

All About Monetary Policy Committee Of RBI (in Hindi)

Mona Choudhary

In this course the educator will discuss some useful information related to LIC AAO exam.
Here we will cover eligibility criteria, syllabus, books to refer,exam pattern , and other useful details related to LIC AAO exam

(Hindi) LIC AAO Exam - Pattern, Syllabus, Books and Eligibility

Qualified IBPS PO, Category Expert at Unacademy, 6+ years of Experience in Teaching for Competitive Exams, MBA in Marketing and Finance

Sakshi Pahwa

In this course, Sakshi Saluja gives a roadmap on how to go about for the preparation of each section for RBI Grade B Phase I. The strategy is a weekly plan for the students, covering the entire syllabus.

30 Days Strategy to Crack RBI Grade B Exam: Weekly Plan

In this course, Sakshi Saluja gives a roadmap on how to go about with the preparation for RBI Grade B exam in the last 30 days. She gives a weekly plan to the students, which covers the entire syllabus.

(Hindi) 30 Days Strategy to crack RBI Grade B- Weekly Plan

 Director: Academics - Unacademy IAS
10+ years of Teaching Experience. 
Expert in Economics & Current Affairs*

Nisha Nujumudeen

This course will give an insight into the Problems of Unemployment in India

Problems of Unemployment: for Economics and Social issues for RBI grade B exam and other Bank exams

Barkha Agrawal

This course is simply a stop to all your doubts about RBI GRADE B exam. In this course, Barkha has discussed the strategy to crack this exam in just 25 days. Barkha has created some short tricks about all the subjects which come in the exam, please go through it.This is a fabulous course and thus needs extra efforts by all the aspirants preparing for it. This course will surely help you all a lot.

(Hindi) Strategy to Crack RBI GRADE B Examination in 25 Days

In this course the educator will discuss full details regarding SBI clerk 2019 so that learners can know full information regarding this exam.
Exam dates, syllabus, exam pattern , eligibility etc everything will be covered in this course.

Lessons

6 lessons • 56m

Invalid Date

NaN

Introduction of Monetary Policy or Credit Policy Nd Why it’s Required For Any Country ? (in Hindi)

Invalid Date

NaN

All About CRR,SLR and Refinance Facility [DIRECT INSTRUMENTS] of Monetary Policy Of RBI (in Hindi)

Invalid Date

NaN

All About REPO RATE and REVERSE REPO RATE {LAF-Liquidity Adjusted Facility} Monetary Policy Of RBI

Invalid Date

NaN

All About BANK RATE and MSF {Marginal Standing Facility} of Monetary Policy Of RBI (in Hindi)

Invalid Date

NaN

All About OMO [Open Market Operations] and Term Repo of Monetary Policy Of RBI

Invalid Date

NaN

All About Monetary Policy Committee Of RBI (in Hindi)