RBI To Inject Liquidity in Banking System
Moneylife Digital Team 28 January 2025
The Reserve Bank of India (RBI) has announced three measures to inject liquidity into the banking system, including open market operations (OMO) purchase auctions of government securities worth Rs60,000 crore, swap auction of US$5bn (billion) and variable rate repo (VRR) auction for Rs50,000 crore.
 
RBI will be conducting daily VRR auctions on all working days in Mumbai, with reversal taking place on the next working day until further notice. "Based on an assessment of the liquidity conditions, it is decided that the notified amount for the daily VRR auction to be conducted on 28 January 2025 will be Rs2 lakh crore," it added.
 
RBI says it will purchase government securities worth Rs60,000 crore in three tranches of Rs20,000 crore each on 30 January 2025, 13th February and 20 February 2025.  
 
As part of measures to manage liquidity conditions, RBI also announced a US dollar (USD)/Indian rupee (INR) buy/sell swap auction of US$5bn for a tenor of six months, which will be held on 31 January 2025.
 
Further, a 56-day VRR auction for a notified amount of Rs50,000 crore will be held on 7 February 2025, RBI says.
 
"The Reserve Bank will continue to monitor evolving liquidity and market conditions and take measures as appropriate to ensure orderly liquidity conditions," it added.
 
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