India Lowers Rates in Patel's First Policy Decision

The Reserve Bank of India (RBI) surprised the market by cutting interest rates by 25 basis points in Governor Urjit Patel's first monetary policy decision. This marks the first decision by the newly formed Monetary Policy Committee (MPC), which unanimously voted for the cut. The RBI expects GDP growth to be around 7.6% and inflation to remain stable at 5%. The decision aligns with the current economic environment, where inflation has decreased, and the US Federal Reserve has not raised rates. This shift represents a significant change from the previous administration under Raghu Rajan, as the MPC now includes six members, three from the RBI and three appointed by the government.

What was the unexpected move made by the RBI in its recent monetary policy?

• Implementation of a new tax

• Cut in interest rates by 25 basis points

• Increase in interest rates

• Introduction of a new currency

What GDP growth rate does Governor Urjit Patel expect for India?

• 6.5%

• 7.6%

• 5.5%

• 8.0%

What is the expected inflation rate according to the RBI's latest policy?

• 3%

• 5%

• 6%

• 4%

How many members are there in the new Monetary Policy Committee?

• Five

• Four

• Six

• Seven

What is the role of the RBI governor in case of a tie in the MPC?

• Decision deferred

• Veto power

• Casting vote

• No role