RBI & MONITORY POLICY

SUBJECT:
Economic environment for business
Subject Teacher:
Prof. K. b. Patil sir.
Presented By:
Parmeshwar D.Vyavhare
 INFORMATION
The Reserve Bank of India (RBI) is India's
central banking institution, which controls the
monetary policy of the Indian rupee. It
commenced its operations on 1 April 1935
with the provisions of the Reserve Bank of
India Act, 1934.
 HISTORY OF RBI
It was established on 1st of April 1935

Initially it was located in Kolkata.

RBIs First governor was Sir Osborne A.Smith

It moved to Mumbai in the year 1937

 Initially it was privately owned

The First Indian Governor was Sir Chintaman

D.Deshmukh(11th August 1943 to 30th June
1949)

It was the 1st bank to be Nationalized in 1949

 ROLE OF RBI
Issuing of currency
Manager of exchange control
It is bankers bank
Controler on bank credit
Banker to the government
 RBI AND MONITORY POLICY
Monetary policy is the macroeconomic policy

In India ,RBI controls the monetary policy.

It involves management of money supply and

interest rate
 OBJECTS OF MONITORY POLICY
Full Employment:

Price Stability:

Economic Growth:

Balance of Payments:
 TYPES OF MONITORY POLICE
1. Expansionary Monetary Policy:
A policy by monetary authorities to expand money supply
and boost economic activity, mainly by keeping interest rates
low to encourage borrowing by companies, individuals and
banks.
2. Contractionary Monetary Policy:
Contractionary monetary policy is a form of economic
policy used to fight inflation which involves decreasing the
money supply in order to increase the cost of borrowing.