BANKING AFFAIRS

Detailed explanation-1: -Answer: The Fed influences the availability and cost of money and credit as the national monetary policy authority to maintain a healthy economy. The Government has given the Fed two coequal monetary policy goals: first, maximum employment; and second, stable prices, which means low, stable inflation.

Detailed explanation-2: -Under the Reserve Bank of India, Act, 1934 (RBI Act, 1934) (as amended in 2016), RBI is entrusted with the responsibility of conducting monetary policy in India with the primary objective of maintaining price stability while keeping in mind the objective of growth.

Detailed explanation-3: -The monetary policy is a policy formulated by the central bank, i.e., RBI (Reserve Bank of India) and relates to the monetary matters of the country. The policy involves measures taken to regulate the supply of money, availability, and cost of credit in the economy.

Detailed explanation-4: -The RBI acts as a regulator and supervisor of the overall financial system. This injects public confidence into the national financial system, protects interest rates, and provides positive banking alternatives to the public. Finally, the RBI acts as the issuer of national currency.