Q- With reference to the -Inflation targeting- in India- consider the following statements-1- The Monetary Policy Committee in consultation with the central government sets the target-2- The target is fixed on an annual basis-3- While there is an upper limit at present for it- no lower limit was set up-Which of the above statements is-are correct-

You visited us 1 times! Enjoying our articles? Unlock Full Access!

Byju's Answer

Standard XI

Statistics

Consumer Price Index

Q. With refer...

Question

Q. With reference to the “Inflation targeting” in India, consider the following statements:
Which of the above statements is/are correct?

1 and 2 only

No worries! We‘ve got your back. Try BYJU‘S free classes today!

2 only

No worries! We‘ve got your back. Try BYJU‘S free classes today!

1 and 3 only

No worries! We‘ve got your back. Try BYJU‘S free classes today!

None of the above

Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses

Open in App

Solution

The correct option is D
None of the above
Explanation:

Statement 1 is incorrect: As per the section 45ZA of the Reserve Bank of India Act, 1934, the Central Government, in consultation with the Reserve Bank of India (RBI) fixes the inflation target.

Statement 2 and 3 are incorrect: In 2016, the central government fixed the inflation target of 4 percent with an upper and lower limits of 6 and 2 percent respectively. This target is applicable till March 31, 2021.

More information:
What happens when RBI fails to meet the inflation target?
RBI shall set out a report to the Central Government stating the

reasons for such a failure

remedial actions proposed to be taken by RBI

an estimate of the time-period within which the inflation target shall be achieved

Suggest Corrections

Similar questions

Q. With reference to the “Inflation targeting” in India, consider the following statements:

Which of the above statements is/are correct?

1 and 2 only
2 only
1 and 3 only
None of the above

Consider the following statements and choose the option which is correct.

(1) Inflation targeting focuses mainly on achieving price stability as the ultimate objective of Monetary policy.

(2) Monetary policy & fiscal policy have to converge for achievement of inflation targeting.

(3) The basket of items in CPI does not include machinery, chemicals etc.

Q.  In the context of the recommendations made by the Urjit Patel committee , which of the following is correct?

1. To adopt the new Consumer Price Index (CPI) for anchoring the monetary policy.
2. Set the inflation target at 4% with a band of +/- 2% .
3. Monetary policy decision making should be vested in a Monetary Policy Committee (MPC) headed by the Governor.

Q. Consider the following statements related to Flexible Inflation Targeting (FIT):

Which of the above statements is/are correct?

1 only
1 and 2 only
2 and 3 only
1, 2 and 3

59. Consider the following statements

1. Regarding the procurement of food-grains, Government of India follows a procurement target rather than an open–ended procurement policy.

2. Government of India announces minimum support prices only for cereals.

3. For distribution under Targeted Public Distribution System (TPDS), wheat and rice are issued by the Government of India at uniform central issue prices to the States/Union Territories.

Which of the statements given above is/are correct?

Join BYJU'S Learning Program