RBI monetary policy trivia: Why policy has been announced mostly on Tuesdays?

I have been wanting to write this post for a long time but somehow keep forgetting.

I have been noticing for a while that RBI prefers to announce its monetary policy decision on mostly Tuesdays. So, just wanted to check whether the noticing matches with the facts. For most this will be just trivia and feel free to ignore.

So, just pulled out the list of dates on which RBI has been announcing its policy since 1998. The previous years data is not there on the website but this should suffice for the time-period. Before getting into weekday discussion, some ideas on evolution of format of policy since 1998:

  • In 1998,  policies were announced twice – Annual in April-end/May-start and Mid-term in October end/Nov start.
  • From Apr-2005 onwards, we have policies announced each quarter: April-end (Annual), July (Q1 review), October (Mid-term) and Jan (Q3 review).
  • From Sep-2010 onwards, RBI begins to announce mid-quarter review apart from the 4 quarterly reviews. Now we have 4 quarterly reviews and 4 mid-quarter reviews: mid-Jun, mid-Sep, mid-Dec and mid-Mar.
  • In Dec-2013, we have the last mid quarter review.
  • From Apr 2014, we moved to bi-monthly review of policy.
  • From Oct -2016 onwards, MPC starts voting on the policy. The policy remains bi-monthly.

Seperately, RBI decided to release Macroeconomic and Monetary Developments from April 1999-2000 which summed up the economy. It was released annually from 1998-2005 and then became a quarterly feature. The publication was eventually discontinued from April 2014 to become a half-yearly publication called Monetary Policy Report.

All the RBI Governors in their tenure, implemented some changes in policy frequency, conduct etc. YV Reddy brought the quarterly reviews, Subbarao mid-quarter reviews, Rajan bi-monthly policy and Patel MPC driven bi-monthly policy.

Coming to the main question. Is the Tuesday observation true? Let’s see this Governor-wise:

Tenure Monday Tuesday Wednesday Thursday Friday Saturday Grand Total
Bimal Jalan 22 Nov 1997 to 5 Sep 2003 2 3 2 1 2 1 11
YV Reddy 6 Sep 2003 to 5 Sep 2008 1 14 1 1 17
D Subbarao 5 Sep 2008 to 4 Sep 2013 3 19 5 5 32
R. Rajan 4 Sep 2013 to 4 Sep 2016 17 1 1 19
Urjit Patel 4 Sep 2016 onwards 1 7 1 9
Grand Total 6 54 11 8 8 1 88
  • Interestingly of the 88 policy meetings/decisions, 54 have been on Tuesdays.
  • There was no day preference for Dr. Jalan.
  • With Dr. Reddy the preference for Tuesday just picked up. In the 17 meetings won which Dr Reddy presided, 17 were on Tuesdays. The three times this differed was his first policy on 3-Nov-2003 (Monday), 28-Apr-05(Thursday) and 31-Jan-07 (Wed).
  • Dr Subbarao follows the same pattern. Of his 32 meetings, 19 were on Tuesday. The other days were mostly for mid-quarter reviews. Of the 12 mid-quarter reviews, 10 were on non-Tuesdays.
Monday Tuesday Wednesday Thursday Friday Saturday Grand Total
D Subbarao 3 19 5 5 32
Annual 4 1 5
Mid Quarter Review 3 2 5 2 12
Mid-Term 4 1 5
Q1 Review 5 5
Q3 Review 4 1 5
  • For Dr Rajan, Tuesday is even more preferred. Of the 19 meetings, 17 were on Tuesdays. The two non-Tuesdays were mid-quarter reviews.
  • Dr Patel has chaired 5 meetings so far. The policy discussions now are of two days with resolution published at 2.30 PM on the second day. The 5 resolutions have been announced on 1 Tues, 3 Wed,  and 1 Thurs. The future schedule shows the weekdays on which future policies are going to be announced will be a Wed. If one considers that MPC discussions are of two days, then again we have Tues involved.

I am wondering what led to this Tuesday fixation for most RBI chiefs? Is it to do with auspiciousness/lucky day or just following traditions?  Or is it the fact that on Tuesday there is no scheduled activity. T-bill auctions are on Wed, G-sec auctions on Friday and so on. Tuesday looks a relatively free day. But as data shows, policies have been announced on other days as well and there were not much problems as market participants figure ways to manage multiple things.

Just some Indian monetary policy trivia..

 

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5 Responses to “RBI monetary policy trivia: Why policy has been announced mostly on Tuesdays?”

  1. A. Vasudevan Says:

    Tuesday is found to be convenient for one possible reason. The weekend would help the RBI work out a draft statement and it will be wetted on Monday by the powers-that-be. Tuesday would be then the D-day. Who knows it could also be regarded as auspicious (mangal) by “believers”?

  2. Roy Says:

    As a former practitioner, it gets really hard to deal with auctions and policy at the same time. It was managed doesnt reflect how hard it was to do.

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