Objectives of RBI’s Monetary Policy

Objectives of the monetary policy in India have gone through a process of gradual evolution and have included price stability, ensuring adequate flow of credit to various productive sectors of the economy and achieving financial stability. The policy stance is based upon the assessment of the macroeconomic and financial conditions and monetary measures. The statements reflect the changing circumstances and priorities of the RBI and a thrust for the future.

  • Reserve Bank of India announces Monetary Policy every year in the Month of April.
  • This is followed by three quarterly Reviews in July, October and January.
  • But, RBI at its discretion can announce the measures at any point of time.

The Annual Monetary Policy is made up of two parts

  • Part A: macroeconomic and monetary developments
  • Part B: Actions taken and fresh policy measures.

Monetary policy of the 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.

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