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Question
Based on the passage below, answer the following question.
The Monetary Policy Committee of the Reserve Bank of India kept interest rates on hold Thursday even as it vowed to keep policy sufficiently loose to help revive the coronavirus battered economy. Accepting a key demand of lenders and the corporate sector, the central bank cleared a one-time restructuring of loan accounts to bail out stressed borrowers, including personal, small, and medium loans.
The details of the loan restructuring scheme – expected to kick in after the moratorium on loan repayments ends. August 31 – will be worked out by a committee headed by former ICICI Bank Chairman KV Kamath. The RBI also continued to provide support on the liquidity front and opened a new targeted window for small lenders.
The central bank kept the repo rate unchanged at 4 percent and reduced the reverse repo rate to 3:35 percent.
Suppose you are a member of the Monetary Policy Committee of the RBI. You have suggested the _________ of the money supply be ensured to help revive the coronavirus battered economy.
Options
restriction
release
doubling
no change
Solution
Suppose you are a member of the Monetary Policy Committee of the RBI. You have suggested the release of the money supply be ensured to help revive the coronavirus battered economy.
