RBI to buy bonds worth Rs 20,000 crore through open market operations
The Reserve Bank of India (RBI) said on Monday it plans to buy bonds worth Rs 20,000 crore through open market operations (OMOs) to support the government’s borrowing programme.
“On a review of current liquidity and financial conditions, the RBI has decided to conduct a purchase of government securities under OMO for an aggregate amount of Rs 20,000 crore on February 10,” the RBI said in a statement. The central bank is expected to buy more at auctions to support the government’s huge borrowing programme.
Last week, RBI Governor Shaktikanta Das assured investors that its stance on liquidity remained accommodative and that the government’s Rs 12.06 lakh crore borrowing programme for the fiscal year starting April will be managed in a smooth and orderly manner.
The government raises money from the market to fund its fiscal deficit through dated securities and treasury bills.