RBI to infuse liquidity through OMO

The Dollar Business Bureau

The Reserve Bank of India is planning to buy government bonds worth Rs 15,000 crore through open market operation(OMO), with a view to infuse liquidity into the market.

The central bank in a statement issued on May 23 said that, after assessing the prevailing and evolving liquidity condition, the RBI has decided to purchase bonds through government securities under the open market operations for an amount of Rs.150 billion on May 25.

However, there is a comprehensive limitation of Rs 150 billion for all the securities put together.

The purchase of these securities will help release similar amount of money in the market and ease the conditions of liquidity.

RBI also said that due to the rounding off and other relevant factors, they can purchase marginally higher than the aggregate amount.

They can also accept or reject any offer wholly or partially without having to assign any reason.

The auction results will be announced on the same day. However, the payment for the same will be made on May 26.