In bid to increase liquidity in the market, the Reserve Bank of India (RBI) has decided to infuse Rs 10,000 crore on January 24, 2019. This is in line with its continuous efforts to adhere commitment of providing adequate liquidity. The central bank had earlier committed to purchase government securities under its open market operations (OMOs) for an aggregate Rs 50,000 crore in January and has so far done Rs 30,000 crore.
RBI has decided to conduct purchase of the Government securities under OMOs for an aggregate amount of Rs 100 billion on January 24, 2019 through multi-security auction using the multiple price method. It has been decided based on an assessment of prevailing liquidity conditions and also of the durable liquidity needs going forward. The Central Bank will buyback five securities maturing between June 2019 and December 2033 through the purchase.
The eligible participants should submit their offers in electronic format on the RBI's core banking solution (E- Kuber) system on January 24. The result of the auction will be announced the same day and payment to successful participants will be made on the following day. It can be noted that ever since August, the system is passing through a liquidity deficit which is being bridged by the central bank using various tools with OMOs being a primary instrument deployed.
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