1. Priya gupta
HPGD/AP15/3341
Specialization - finance

2. Role of RBI in Controlling Currency Fluctuation

3. FLOW Introduction Definition Functions of RBI
Currency Impact on economy
currency fluctuations
effects of currency fluctuations on economy
Role of rbi
Instrument of credit control
The Global Influence of Currencies – Examples
Conclusion

4. Introduction
The Reserve Bank of India (RBI) is India's central banking institution, which controls the monetary policy of the Indian rupee.
The RBI is also a banker to the government and performs merchant banking function for the central and the state governments.
It is a member of the Asian Clearing Union

5. Definition of RBI
“The central bank of India, which was established on April 1, 1935, under the Reserve Bank of India Act. The RBI uses monetary policy to create financial stability in India and is charged with regulating the country's currency and credit systems.”

6. Function of rbi Regulator and supervisor of the financial system
Bank of Issue
Monetary Authority
Managerial of Exchange Control
Issuer of Currency

7. Merchandise trade Economic growth Inflation Capital flows
Currency Impact on the Economy
Merchandise trade
Economic growth
Capital flows
Inflation
Interest rates

8. CURRENCY FLUCTUATION
The exchange rate of one currency versus the other is influenced by numerous fundamental and technical factors.
A currency has value, or worth, in relation to other currencies, and those values change constantly.
Some currencies fluctuate freely against each other, such as the Japanese yen and the US dollar, others are pegged, or linked.

9. Effect of currency fluctuation on the economy
Currency fluctuations are a natural outcome of the floating exchange rate system
It include relative supply and demand of the two currencies, economic performance, outlook for inflation, interest rate differentials
A currency’s level is largely supposed to be determined by the underlying economy

10. ROLE OF RBI Acts as the currency authority
Controls money supply and credit
Manages foreign exchange
Serves as a banker to the government
Supervises banks
cts as the banker of banks

11. INSTRUMENTS OF CREDIT CONTROL
QUANTITATIVE OR
GENERAL METHOD
QUALITATIVE OR
SELECTIVE METHOD

12. QUANTITATIVE OR GENERAL METHOD
Bank rate
Open market
Operation
Change in cash
Reserve ratio (CRR)
Statutory liquidity ratio
Repo and reverse repo ration

13. Selective credit control Rationing of credit Moral persuasion
QUALITATIVE OR SELECTIVE METHOD
Selective credit control
Rationing of credit
Moral persuasion
Direct action

14. The Global Influence of Currencies – Examples
The Asian crisis of
China’s undervalued yuan
Japanese yen’s gyrations from 2008 to mid-2013
Euro fears ( )

15. CONCLUSION
Central bank plays important role in achieving economic growth of a developing country
It promotes economic growth with stability
It helps in attaining full employment balance of payment disequilibrium and in stabilizing exchange rate.
The rbi operates a number of government mints that produces currency and coins.

16. Bibliography