Article 1: RBI Monetary Policy Report (October 2025).
1. What will be the updated GDP growth prediction of India in FY 2025-26 according to the RBI report of October 2025?
a) 6.5%
b) 6.8%
c) 7.0%
d) 6.6%
Answer: b) 6.8%
Reasoning: The RBI changed its growth forecast of the GDP upwards to 6.8 percent compared to its earlier forecast of 6.5 percent owing to positive trends in domestic growth.
2. What was one of the leading reasons given to the reduction in CPI inflation forecast to 2.6?
a) Rising global oil prices
b) A precipitous and extended decline in food prices.
c) Weakness of the Chinese Yuan.
d) Hike in policy repo rate.
Response: b) A precipitous and sustained drop in food prices.
Explanation: The report points out that the food prices fell during the 9 months and this was the longest drop in the CPI history and was one of the significant factors that led to low inflation.
Article 2: LIC and RBL Bank Bancassurance Partnership.
1. What is the main objective of LIC and RBL Bank partnership?
a) To consolidate their banking.
b) To sell insurance products of LIC to the customers of RBL Bank.
c) To develop a new online payment system.
d) To lend to LIC policyholders.
Reason: b) To provide insurance products of LIC to the clients of RBL Bank.
Mechanism: The essence of the bancassurance is that the bank (RBL) will sell the products of the insurer (LIC) to its current customers.
2. What national vision is this partnership contributing to?
a) Digital India
b) Make in India
c) Insurance for All by 2047
d) Atmanirbhar Bharat
Answer: c) Insurance for All by 2047
Purpose: The article clearly mentions that the partnership helps to achieve the national vision of Insurance for All by 2047 through increased insurance penetration.
Article 3: RBI Regulation on foreign AT1 Bonds.
1. What is the new eligibility limit of the addition of overseas Perpetual Debt Instruments (PDIs) to the AT1 capital of a bank?
a) 1.0 percent of Risk Weighted Assets (RWAs).
b) 1.5% of the Risk Weighted Assets (RWAs)
c) 2.0 percent of risk weighted assets (RWAs).
d) 2.5 percent of Risk Weighted Assets (RWAs).
Response: b) 1.5 per cent of the Risk weighted assets (RWAs).
Explanation: According to the new directions, the PDIs issued abroad may be included in AT1 capital up to 1.5% of the RWAs of the bank.
2. Another major peculiarity of AT1 Bonds that ensure insolvency security of the bank is that they can be:
a) Redeemed any time by investor.
b) Put on record or translated into equity.
c) Pay shareholder dividends.
d) Traded in any major stock exchange.
Response: b)written or translated into equity.
Explanation: AT1 bonds are black holes; when the bank capital gets to a point that it goes below a specified threshold, the AT1 bonds can be written off or changed to equity to help stabilize the bank.
Article 4: Discretion and Transparency in loan rates switches.
1. Under the new Amendment Directions, 2025 the possibility of a borrower moving to a fixed interest rate, instead of a floating interest rate is now:
a) An obligatory contribution on the part