The Reserve Bank Friday announced it will purchase government securities (G-secs) worth Rs 10,000 crore on September 19, a move aimed at inducing liquidity in the system.
The purchase of the government securities will be done through Open Market Operations (OMO).
“Based on an assessment of prevailing liquidity conditions and also of the durable liquidity needs going forward, the Reserve Bank has decided to conduct purchase of Government securities under Open Market Operations for an aggregate amount of Rs 100 billion on September 19, 2018 (Wednesday) through multi-security auction using the multiple price method,” it said in a statement.
The RBI proposes to purchase G-secs having five different maturity dates.
It further said there is an overall aggregate ceiling of Rs 10,000 crore for all the securities in the basket put together.
“There is no security-wise notified amount,” the central bank said.
The eligible participants have been asked to submit their offers in electronic format on the RBI’s Core Banking Solution (E-Kuber) system on September 19.
The result of the auction will be announced on the same day and payment to successful participants will be on Friday.
Source: Financial Express