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Reading practice

IELTS Reading: Economics

Trade, markets, globalisation, and economic development.

Band 7 Difficulty
Academic Reading
Question type:
Reading · Passage
222 words

Monetary policy of India

Monetary policy is the process by which the monetary authority of a country, generally central bank controls the supply of money in the economy. In India, the central monetary authority is the Reserve Bank of India (RBI).

== Monetary policy committee == The Reserve Bank of India Act, 1934 (RBI Act) was amended by the Finance Act, 2016, to provide a statutory and institutionalised framework for a Monetary Policy Committee, for maintaining price stability, while keeping in mind the objective of growth. The Monetary Policy Committee is entrusted with the task of fixing the benchmark policy rate (repo rate) required to maintain inflation within the specified target level. As per the provisions of the RBI Act, three of the six Members of the Monetary Policy Committee will be from the RBI and the other three Members will be appointed by the Central Government. The Government of India, in consultation with RBI, notified the 'Inflation Target' in the Gazette of India Extraordinary dated 5 August 2016 for the period beginning from the date of publication of the notification and ending on 31 March 2021 as 4%. At the same time, lower and upper tolerance levels were notified to be 2% and 6% respectively. Inflation rate in 2020 is 6.2% .

== Key indicators == The key indicators as of 10 June 2024 are

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AI-generated Cambridge-style passage · 222 words

Questions

1.

According to the passage, what is the primary role of the Monetary Policy Committee?

2.

Which of the following most accurately describes the composition of the Monetary Policy Committee?

3.

The passage implies that the establishment of the Monetary Policy Committee framework was intended to achieve which of the following?

4.

According to the passage, what was the status of India's inflation rate in 2020 relative to the notified tolerance band?

5.

The passage suggests that the Inflation Target notification of August 2016 was:

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About IELTS Reading: Economics

Economics is a frequently tested topic in IELTS Academic Reading. Passages on this theme typically use formal academic language with discipline-specific vocabulary. Understanding key terms and the ability to follow complex arguments are essential for answering questions correctly at Band 7 and above.

The passage above is generated at Cambridge difficulty and comes with the question type you selected. Practise different question types to build a complete skill set for the economics topic area.

Frequently Asked Questions about IELTS Economics

Yes. Economics is a common subject area for IELTS Academic Reading passages. Passages typically explore trade, markets, globalisation, and economic development. which are standard academic domains tested by Cambridge examiners.
To score Band 7+ on Economics reading passages, you should build a strong vocabulary around terms like: economics, trade, market, globalisation, finance. Recognising synonyms and paraphrases of these words in the questions is key to finding the correct answers.
You can practice dynamically on IELTSbiz. Select the Economics topic in our library, choose your weak question type (e.g., Multiple Choice, Matching Headings, True/False/Not Given), and click start. You will receive an AI-generated Cambridge-difficulty passage with instant trap-level explanations.

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