RBI announces Rs 1 trn bond buy, $10 bn $-Re swap to infuse liquidity

The central bank announced open market operations (OMO) auctions to purchase government securities worth Rs 1 trillion in two tranches of Rs 50,000 crore each on March 12 and March 18

Anticipating tight liquidity conditions by the end of the current financial year (FY25) amid tax outflows and banks rushing to meet targets, the Reserve Bank of India (RBI) on Wednesday announced fresh measures that would infuse close to ₹1.9 trillion of liquidity in the banking system.

 

The RBI said it would go for open market operation (OMO) auctions to purchase government securities worth ₹1 trillion in two tranches of ₹50,000 crore each on March 12 and March 18. Additionally, a USD/INR buy-sell swap auction for $10 billion with a tenor of 36 months is scheduled for March 24.

 

These steps,