The Indian government said Shaktikanta Das has been re-appointed as the governor of the Reserve Bank of India (RBI) for another three years or until further orders.
The decision was approved by the cabinet's appointments committee late on Thursday.
Das first took the helm in December 2018 and before that was the department of economic affairs secretary at the finance ministry.
To shore up the economy against the impact of the COVID-19 pandemic, the central bank has cut key interest rates to record lows and infused massive rupee liquidity into the banking system.
With markets now gearing up for the reversal of the ultra-loose monetary policy, stability at the RBI in terms of the top leadership is seen as crucial.
The central bank has taken a more consultative approach with markets under Das who has been keen to have more transparency and direct communication.