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What is Monetary Policy

                         MONETARY POLICY 

Monetary Policy is the process by which the monetary authority of a country controls the supply of money often targeting an Inflation rate or interest rate to price stability. And general trust in the currency and economic growth and lower unemployment .

*Monetary policy committee (MPL) , it consists of 6 members , 3 from RBI  and 3 from Govt of India.
*RBI governor will  caste his vote in case of  a tie.
* Monetary Policy  is of two types
1.Direct Instruments,
2. Indirect Instruments.

*Direct Instrument                                                      1.CRR:- Cash Reserve Ratio,
  2.SLR :- Statutory Liquidity Ratio,
  3.Refinance Facilty.

*Indirect Instrument
 1. LAF :- Liquidity Adjustment Facility,
 2. Repo Rate,
 3. Reverse Repo Rate ,
 4. Bank Rate,
 5. MSF :- Marginal Standing Facility ,
 6. OMO:-Open Market Operations ,
 7. MSS :- Market Stability Scheme.  

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