RBI MPC Meeting: Reserve Bank of India (RBI) Governor Shaktikanta Das reiterated on Wednesday that the bank will not issue its message to the central government for the public. However, the decision and minutes taken in the MPC meeting are to be published as per the RBI Act. RBI has scheduled a meeting of the Monetary Policy Committee (MPC) on November 3 under Section 45ZN of the Act.
Trying to keep an eye on inflation rate like Arjun – Das
RBI Governor Shaktikanta Das said at the annual FIBAC conference of bankers on Wednesday, “The Reserve Bank is tracking inflation in the same way as Arjuna in Mahabharata focused to shoot an arrow into the eye of a revolving fish. No one can match Arjun’s skill, but we (RBI) are trying to keep a constant watch on inflation like Arjun.” This comment has come at a time when the inflation rate is very high and the RBI will soon give an explanation to the government in this regard.
RBI has defended its strategy
Das defended the RBI’s strategies amid criticism over the issue of inflation in recent days and said the country would have had to pay a heavy price if the RBI had started tightening it prematurely. Das also said that the RBI rate setting committee will hold a meeting on Thursday. In this meeting, an explanation will be prepared that under what circumstances the inflation rate has exceeded the target, while it will also contain the details of the corrective measures.
Minutes of RBI MPC meeting to be published
In its next meeting, the MPC will discuss why it has not been able to rein in inflation and will inform the Centre. RBI can inform the central government about the situation of inflation as well as the reasons for its high level. Das had said that communication with the central government is a privileged one and will not be made public by the bank. He reiterated that stance while addressing the annual FIBACK 2022 conference jointly organized by FICCI and IBA in Mumbai on Wednesday. However, as per section 45ZK, RBI shall publish the resolution adopted by the committee after the conclusion of each meeting of the MPC.
According to the section, if the RBI fails to meet the inflation target, it shall send a report to the central government, detailing: (a) the reasons for the failure to meet the inflation rate target, (b) the (c) an estimate of the proposed remedial action to be taken and (c) the time period within which the inflation target will be achieved by the proposed corrective action.
Further, as per Section 45ZL of the RBI Act, the minutes of the MPC meeting are to be published on the 14th day after each meeting, including –
(a) Resolution adopted in the meeting of the MPC
(b) the vote of each member of the MPC and the opinion of the member on the resolutions adopted at that meeting (c) the statement of each member of the MPC under sub-section (11) of section 45ZL on the resolutions adopted at the meeting.
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