Question

Fill in the blank:
............... releases data of money supply in India. (Choose the correct option to fill in the blank)

• A. Corporation Bank
• B. Reserve Bank of India
• C. Commercial Banks
• D. State Bank of India

Hint:

The Reserve Bank of India is the only authorized body to release official statistics on monetary aggregates like M1, M2, M3, etc. It plays a pivotal role in inflation control and liquidity regulation.

Answer 1

The Correct Option is B

The Reserve Bank of India (RBI), founded in 1935, is India's central bank, overseeing the monetary and financial system. A core function is managing the nation's money supply.
RBI regularly publishes money supply data through reports like the Weekly Statistical Supplement (WSS) and Annual Reports.
Money supply represents the total money in circulation at a specific time. This includes:
Currency held by the public
Demand deposits in banks
Time deposits and other near-money assets

The RBI categorizes money supply into different aggregates:
M1 (Narrow Money): Currency with the public + Demand deposits + Other deposits with RBI
M2, M3, M4: These are broader measures with increasing liquidity levels

These aggregates assist economists and policymakers in analyzing liquidity, inflation, and creating monetary policy. Only the RBI is authorized to release official money supply data; commercial or public sector banks like SBI or Corporation Bank do not have this authority.