Monetary policy is the policy adopted by the authority of a nation to control either the interest rate payable for very short term borrowings or the money supply, often as an attempt to reduce inflation or the interest rate, to ensure price stability and general trust of the value and stability of the nation's currency for every financial year based on the quarter, the new policy is made and executed for the growth of the economy. The RBI carries out the monetary policy through open market tasks, bank rate strategy, reserve system, credit control strategy, moral influence and through numerous different instruments.

1. MONETARY
POLICY
SUBMITTED TO: DR.MADHUMITA DAS
SUBMITTED BY: KAKOLI BHAKAT(29), ROSHAN
DASH(63), REETIKA RATH(82)

2. INTRODUCTION
Monetary policy is the policy adopted by the
authority of a nation to control either the interest
rate payable for very short term borrowings or the
money supply, often as an attempt to reduce
inflation or the interest rate, to ensure price
stability and general trust of the value and stability
of the nation's currency for every financial year
based on the quarter, the new policy is made and
executed for the growth of the economy. The RBI
carries out the monetary policy through open
market tasks, bank rate strategy, reserve system,
credit control strategy, moral influence and through
numerous different instruments.

3. MONETARY
POLICY
Monetary policy is the macroeconomic
policy laid down by the central bank. 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,
growth and liquidity.
There are two types of monetary policy:
1. Expansionary monetary policy
2. Contractionary monetary policy

4. Monetary policies can
target inflation levels. A
low level of inflation is
considered to be healthy
for the economy. If
inflation is high, a
contractionary policy
can address this issue.
UNEMPOLYMENT
Monetary policies can
influence the level of
unemployment in the
economy
CURRENCY
EXCHANGE RATES
Using its fiscal
authority, a central
bank can regulate the
exchange rates
between domestic
and foreign
currencies.
OBJECTIVES OF MONETARY POLICY
INFLATION

5. CHANGE RESERVE
REQUIREMENTS
INTEREST RATE
ADJUSTMENT
OPEN MARKET
OPERATIONS
TOOLS OF MONETARY POLICY
TOOLS OF MONETARY POLICY
A central bank can
influence interest
rates by changing
the discount rate.
The discount rate
(base rate) is an
interest rate charged
by a central bank to
banks for short-
term loans.
Central banks usually set up the
minimum amount of reserves that
must be held by a commercial bank.
By changing the required amount,
the central bank can influence the
money supply in the economy.
Open market
operation refer
to the sale and
purchase of
securities in the
open market by
the RBI on the
behalf of the
government.

6. MONETARY POLICY (5-7,2021)
RESOLUTION
The repo rate- Keeping the policy repo rate
under the liquidity change office (LAF) unaltered
at 4.0 percent.
Reverse repo rate- the reverse repo rate under
the LAF stays unaltered at 3.35 percent the
marginal standing office (MSF) rate and the
Bank Rate at 4.25 percent.
The Monetary Policy Committee (MPC), constituted
under section 45ZB of the Reserve Bank of India Act,
1934, was held from April 5 to 7, 2021. The MPC
reviewed the surveys conducted by the Reserve
Bank to gauge consumer confidence, households’
inflation expectations, corporate sector
performance, credit conditions, the outlook for
the industrial, services, and infrastructure sectors,
and the projections of professional forecasters.

7. ASSESSMENT
1. GLOBAL ECONOMY
2. DOMESTIC ECONOMY
India’s real gross domestic product (GDP) contraction at 8.0 per cent during
the year.
2.1 Manufacturing and service activities
Purchasing managers’ index (PMI) manufacturing at 55.4 in March 2021 stayed in
expansion zone, however lower than its level in February.
2.2 Industrial production
The index of industrial production slipped into peripheral constriction in January 2021,
hauled somewhere near assembling and mining. Centre enterprises additionally contracted
in February.
2.3 Agriculture
The flexibility of farming is obvious from food grains and agriculture creation for 2020-21,
which are relied upon to be 2.0 percent and 1.8 percent higher separately than the last
gauges of 2019-20. Inflation expanded to 5.0 percent in February in the wake of having
facilitated to 4.1 percent in January 2021.Within an overall food inflation print of 4.3 per
cent in February.
• System liquidity stayed in huge excess in February and March 2021 with normal
everyday net liquidity absorption of ₹5.9 lakh crore, driven by-
 Currency demand, reserve money (RM) increased by 14.2 per cent
 Money supply (M3) grew by 11.8 per cent
 Credit growth at 5.6 per cent.

8. The repo rate-keep the policy repo rate under the
liquidity change office (LAF) unaltered at 4.0
percent, same as the monetary policy held on April
5-7, 2021
Reverse repo rate-the reverse repo rate under the
LAF stays unaltered at 3.35 percent and the
marginal standing office (MSF) rate and the Bank
Rate at 4.25 percent.
MONETARY POLICY, JUNE 2-4, 2021
MONETARY POLICY, JUNE 2-4, 2021
The twenty 10th gathering of the Monetary
Policy Committee (MPC), comprised under
segment 45ZB of the Reserve Bank of India
Act, 1934, was held from June 2 to 4, 2021.
RESOLUTION

9. ASSESSMENT
1.GLOBAL ECONOMY
2. DOMESTIC ECONOMY
India’s real gross domestic product (GDP) contraction at 7.3 per cent for 2020-21, with GDP
growth in Q4 at 1.6 per cent year-on-year
2.1 Manufacturing and service activities
2.2 Industrial production
2.3 Agriculture
2.4 GST
2.5 Inflations
System liquidity remained in large surplus in April and May 2021, with average daily net absorption under the
liquidity adjustment facility (LAF) amounting to ₹5.2 lakh crore, driven by-
1.Reserve money expanded by 12.4 per cent
2.Money supply (M3) and bank credit grew by 9.9 Percent and 6.0 per cent,
3.India’s foreign exchange reserves increased by US$ 21.2 billion in 2021-22 (up to May 28) to US$ 598.2 billion

10. CPI Inflation
Factors of inflation
The bumper food grains production in 2020-21 ought to support mellowing
of cereal costs going ahead.
Decrease of extract obligations and cess and state level assessments could
give some help to buyers on top of the new facilitating of worldwide
unrefined costs.
Decrease of import obligations and proper motivating forces to upgrade
usefulness locally could run after a superior interest supply balance over
the medium-term.
Taking into consideration all these factors, CPI inflation is now projected
as 5.0 per cent
Factors of inflation
The rising direction of global product costs, particularly of rough,
along with coordination costs, present potential gain dangers to the
inflation standpoint.
Extract obligations, cess and charges forced by the Center and States
should be changed in an organized way to contain input cost pressures
radiating from petroleum and diesel costs
•Taking into consideration all these factors, CPI inflation is projected
at 5.1 per cent during 2021-22

11. Real GDP
Factors of real GDP growth
•Metropolitan interest has been acquiring strength on the rear of
standardization of financial action and ought to get a fillip with the
continuous inoculation drive
•Rural demand stays light and record agriculture production for 2020-21
looks good for its flexibility
•The fiscal improvement from expanded portion for capital use under
the Union Budget 2021-22, extended creation connected impetuses
(PLI) plan and rising limit usage (from 63.3 percent in Q2 to 66.6
percent in Q3:2020-21) ought to offer solid help to speculation interest
and fares.
•Taking these factors into consideration, the projection of real GDP
growth for 2021-22 is retained at 10.5 per cent
Factors of real GDP growth
• Rural demand stays solid and the normal ordinary
rainstorm looks good for supporting its lightness, going
ahead
• Metropolitan interest has been scratched continuously
wave, yet selection of new COVID-viable word related
models by organizations for a fitting work space may pad
the hit to financial action, particularly in assembling and
administrations areas that are not contact concentrated
• Taking these factors into consideration, real GDP growth
is now projected at 9.5 per cent in 2021-22

12. STATEMENTS
Dr. Mridul K. Saggar-He talks about the inflation, Over the
initial five-year time of rehearsing expansion focusing on, the
feature swelling found the middle value of 4.3 percent
contrasted and the circumstance when the CPI swelling was
averaging around twofold digits for a very long time before this
system was conceived.
Dr. Michael Debabrata Patra-He talks about the
inflation, The growth inflation compromise and
thusly, strategy decisions have moved towards
expanding convenience. High recurrence markers for
April and May 2021 highlight a slowing down of the
recuperation that was in progress from the second
50% of 2020-21. Dissimilar to in the main wave,
supply conditions have remained somewhat tough in
the subsequent wave, however total interest
notwithstanding net fares has been imprinted and
needs counter-pandemic approach support.
Dr. Shashanka Bhide-He talks about the GDP, The Second
Advance Estimates by the National Statistical Office place
the GDP at consistent costs lower by 8% in 2020-21 over
the earlier year, somewhat more extreme decay than
decrease of 7.7 percent according to the First Advance
Estimates.
He talk about the GDP, the real GDP development at - 7.3
percent over the earlier year, a lower pace of compression than
gave in the Second Advance Estimates. The year-on-year
development paces of key segments of total interest, Private
Final Consumption and Government Final Consumption
Expenditures, Exports and Gross Fixed Capital Formation
enlisted generous recuperation in Q4 contrasted with the
exhibition in the past quarter.

13. CONCLUSION
The Reserve Bank of India (RBI) Monetary Policy has kept the financing costs unaltered.
The repo rate has been kept at 4%. The opposite repo rate or the public bank's getting has
been unaltered at 3.35 percent. The public bank has also projected certified GDP
advancement of 9.5 percent for this money related year, which is lower diverged from the
earlier check of 10.5 percent in view of the impact of the second Covid wave. As per the
total national output (GDP) measures government conveyed as of late, the economy
contracted by 7.3 percent in the financial year 2020-21, while the agribusiness region saw
the advancement of 3.6 percent, and the organizations and industry regions contracted by
8.4 percent and seven percent independently. The Reserve Bank has cut its key crediting
rates for instance repo rate by 115 reason centers since March 2020 to cushion the economy
from the significant spasm of Covid-19. The retail development has also worked with a
three-month low of 4.29 percent on the record of abatement in food costs like vegetables
and grains, according to government data. The RBI in its each and every other month cash
related technique review in April 2021 focused on the retail development at 5.2 percent in
the principle segment of the current monetary 2021-22 and inside the two - six percent band
in the medium term. RBI Governor also said that the public bank will open a remarkable
liquidity window of Rs 15,000 crore till March 30, 2022, with tenors of up to three years at
the repo rate.

14. THANKYOU