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Role of the Reserve Bank of India (RBI)

The role of RBI has been highlighted in the following points:
  • Apex institution: The RBI is the apex monetary institution in India. It strengthens, develops and diversifies the country’s economic and financial structure.
  • Economic stability: It is responsible for economic stability of the country and assisting in the growth of the economy.
  • Controls monetary policy: RBI has the responsibility of controlling the country’s monetary policy.
  • Advisor: It advises the Government on economic and financial policies and also represents the country in international economic forums.
  • Friend, philosopher and guide: It is responsible for the development of a sound banking system and the growth of organized capital and money markets by offering its guidance in matters of economic relevance.
  • Inflation: The RBI plays a vital role in keeping inflationary trends under control.
  • Feedback: The RBI has the power to ask the commercial banks to submit a weekly feedback containing information regarding their working.

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