RBI Monetary Policy Committee (MPC)
Composition and Mandate
The Monetary Policy Committee was established by amending the Reserve Bank of India Act, 1934, through the Finance Act, 2016. It is a statutory, six-member body that determines the policy repo rate required to achieve the inflation target set by the government.
- Composition: 6 members — 3 from RBI (Governor, two Deputy Governors or senior officials) and 3 external members nominated by the Central Government.
- Statutory basis: Section 45ZB of the RBI Act provides for MPC constitution; Section 45ZA empowers the Central Government (in consultation with RBI) to set the inflation target, published in the Official Gazette every five years.
- Inflation target: 4% CPI (Consumer Price Index) with a tolerance band of ±2% (i.e., 2%–6%).
- Decision-making: Each member has one vote; the Governor casts a second/casting vote in case of a tie.
- External members serve a 4-year term and are not eligible for reappointment.
- Sections 45ZA–45ZL of the RBI Act collectively constitute the inflation targeting framework.
● Tracked since February 25, 2026 · last seen April 11, 2026 · updates as the daily brief publishes
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