Which of the following statement is correct about the Monetary Policy Framework Agreement between th...........

Which of the following statement is correct about the Monetary Policy Framework Agreement between the RBI and the Government of India?

1. Under this agreement, the objective of monetary policy framework was to maintain price stability, while keeping in mind the objective of growth.

2.As per the Agreement, the target for inflation was set at below 8% by January 2016 and within 4 per cent with a band of (+/-) 2 per cent for 2016-17 and all subsequent years.

only 1

only 2

Both 1 and 2

Neither 1 nor 2

Explanation:

The government and the RBI decided to introduce a modern monetary policy framework with a focus on inflation targeting. The first attempt at modernising the monetary policy framework came about with the signing of the Monetary Policy Framework Agreement between the RBI and the Government of India in February 2015. Under this agreement, the objective of monetary policy framework was to maintain price stability, while keeping in mind the objective of growth. As per the Agreement, the target for inflation was set at below 6% by January 2016 and within 4 per cent with a band of (+/-) 2 per cent for 2016-17 and all subsequent years.