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), established in 1935, is India's central bank and the key regulator of the monetary and financial system. One of its critical roles is to monitor and manage the country’s money supply.
RBI regularly compiles and publishes data on the money supply in the economy through its official reports such as the Weekly Statistical Supplement (WSS), Annual Reports, and other bulletins. The concept of money supply refers to the total stock of money circulating in the economy at a particular time. This includes:
Currency with the public
Demand deposits with the banks
Time deposits and other near-money assets
The RBI classifies money supply into different categories or aggregates:
M1 (Narrow Money): Currency with the public + Demand deposits + Other deposits with RBI
M2, M3, M4: These include broader measures with increasing levels of liquidity
These aggregates help economists and policymakers to analyze liquidity, inflation, and formulate monetary policy decisions. No commercial or specific public sector banks like SBI or Corporation Bank have the authority to release official data on money supply — this role solely lies with the RBI.