Monetary Policy Committee (MPC)

Published on 14 Nov 2025

• The Central Board of Directors of Reserve Bank of India (RBI), at its recent meeting held in Lucknow, approved the nomination of Indranil Bhattacharyya, Executive Director, as an ex officio member of the Monetary Policy Committee (MPC).

• The MPC is a six-member body within the RBI & the constitution of the committee is as follows:

• RBI Governor (ex-officio Chairperson)

• RBI Deputy Governor (in charge of monetary policy)

• One RBI officer nominated by the Central Board

• Three external members appointed by the central government with expertise in economics, banking and finance, or monetary policy

• Each member has an equal vote and in case of a tie, the Governor casts the deciding vote. 

• The core responsibility of this committee is to decide the policy repo rate, which is the rate at which the RBI lends short-term funds to financial institutions & is tasked with keeping inflation within the target range of 4% to 6%. 

• The MPC was introduced through an amendment to the RBI Act, 1934, and was formally set up in 2016. 

• Before that, decisions around interest rates were taken solely by the RBI Governor. 

However, with the growing complexity of the economy, the government introduced a more collaborative model, and thus the MPC was established.

Keywords:

Monetary Policy Committee MPC Reserve Bank of India RBI Indranil Bhattacharyya price stability Economic growth Inflation