UPSC Prelims Practice Questions — Centre asks RBI to keep retail inflation target at 4% till 2031

Question 1

For the 4% inflation target retained for 2026–2031, which one of the following is the nominal anchor (price index) against which the target is defined?

Accepted Answer

Consumer Price Index (CPI) – Combined

Answer

Wholesale Price Index (WPI)

Answer

Consumer Price Index for Industrial Workers (CPI-IW)

Answer

GDP deflator

Question 2

Which authority issues the Official Gazette notification that fixes the RBI's retail inflation target, including the March 25, 2026 notification retaining it at 4% till 2031?

Accepted Answer

Department of Economic Affairs, Ministry of Finance

Answer

Department of Financial Services, Ministry of Finance

Answer

Monetary Policy Committee of the RBI

Answer

Department of Revenue, Ministry of Finance

Question 3

Under which provision of the Reserve Bank of India Act, 1934 does the Central Government, in consultation with the RBI, determine the inflation target once every five years?

Accepted Answer

Section 45ZA

Answer

Section 45ZB

Answer

Section 45ZL

Answer

Section 45IB

UPSC Prelims Practice Questions — Centre asks RBI to keep retail inflation target at 4% till 2031

Q1. For the 4% inflation target retained for 2026–2031, which one of the following is the nominal anchor (price index) against which the target is defined?

Q2. Which authority issues the Official Gazette notification that fixes the RBI's retail inflation target, including the March 25, 2026 notification retaining it at 4% till 2031?

Q3. Under which provision of the Reserve Bank of India Act, 1934 does the Central Government, in consultation with the RBI, determine the inflation target once every five years?