The Monetary Policy Committee (MPC) has been constituted by central government in September 2016 for maintaining price stability, while keeping in mind the objective of growth.
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The committee consists of six members of which three Members are from the RBI and the other three Members of MPC are appointed by the Central Government:
The Members of the Monetary Policy Committee appointed by the Central Government shall hold office for a period of four years
The Central Government in September 2016 nominated the members as under:
The Reserve Bank of India Act, 1934 (RBI Act) has been amended by the Finance Act, 2016 to provide a statutory basis for the implementation of the flexible inflation targeting framework. The task of the committee is to fix the benchmark policy rate (repo rate) required to contain inflation within the specified target level.
The meetings of the Monetary Policy Committee shall be held at least 4 times a year and it shall publish its decisions after each such meeting.
Section 45ZB of the amended RBI Act, 1934 also provides for an empowered six-member monetary policy committee (MPC) to be constituted by the Central Government by notification in the Official Gazette
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