In the recent past, the thrust of the monetary policy of India was on reducing the annual inflation rate. The monetary authorities are striving hard to curb the inflation by adopting several monetary policy measures, the important amongst which are changes in CRR, repo and reverse repo rate, which directly influence the money supply in the market with immediate effect without creating any distortions in the economy. In this paper the econometric study of impact of changes in CRR, repo rate and reverse repo rate adopted by the monetary authorities in curbing inflation is carried out and the model is formulated to evaluate the various alternatives to suggest the suitable policy based on the existing market scenario which can be implemented to curb the existing level of inflation. By monetary policy, we mean policy concerned with changes in the supply of money. Issues connected with monetary policy are: objectives or goals of the policy, instruments of monetary control, its efficacy, implementation, intermediate target of the policy etc. India‘s monetary policy since the first plan period was one of 'controlled expansion-that is, a policy of adequate financing of economic growth ensuring reasonable price stability. Thus, RBI helped the economy to expand via expansion of money and credit and attempted to check rise in prices through monetary and other control measures. The first phase of reform started with a reduction of Statutory Liquidity Ratio (SLR) and Cash Reserve Ratio (CRR) and permitted a degree of flexibility to the banks in the matter of deposit interest rates.