What is the RBI Mondetry policy?

The RBI Monetary Policy is a tool used by the Reserve Bank of India to regulate the growth of Indian Economy. The RBI changes its monetary policy in response to changes in inflation, growth, crude oil prices and other indicators. In order to maintain price stability, it usually pays greater attention to changes in liquidity conditions and credit flow rather than interest rates. The need for broadening the scope of monetary policy arises from the fact that surging oil prices affect India more than most countries because we import most our fuel requirements.

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