Mumbai, March 23 (SocialNews.XYZ) In another move to ensure adequate liquidity in the system, the Reserve Bank of India on Monday announced to conduct term repo operations of Rs 1 lakh crore in two equal tranches on March 23 and March 24.
"As a pre-emptive measure to tide over any frictional liquidity requirements on account of dislocations due to COVID-19, the Reserve Bank of India has decided to conduct the following fine-tuning variable rate Repo auctions for Rs 1,00,000 crores in two tranches," an RBI statement said.
Both the tranches of auctions have a tenor of 16 days and the dates of reversal for both the tranches are April 8 and 9.
It said that as a special case, 'Standalone Primary Dealers' will be allowed to participate in these auctions along with other eligible participants and all other terms and conditions as applicable to term Repo auctions will remain the same.
The central bank said that it is monitoring the evolving financial market conditions.
"The Reserve Bank will calibrate its operations to meet any need for additional liquidity support, if warranted, to ensure normal functioning of markets, promote staff welfare and preserve financial stability."
On March 16, RBI Governor Shaktikan ta Das announced that the central bank has decided to conduct more long term repo operations (LTROs).
Addressing media persons here, RBI Governor Shaktikanta Das had said that that fresh LTROs will be conducted via which Rs 1 lakh crore will be injected through multiple tranches.
In another move, the RBI on Monday said that the second tranche of the open market purchase of government securities for Rs 15,000 crore has been advanced to March 26 from the original date of March 30, 2020.
The first tranche of the open market purchase of the government securities worth Rs 15,000 will be be conducted on Tuesday, March 24.
It had last week announced its intent to purchase government securities under Open Market Operations (OMOs) for an aggregate amount of Rs 30,000 crores.
"On a review of current liquidity and financial conditions, the Reserve Bank has decided to advance the second tranche of purchase of Government securities under Open Market Operations (OMOs) for Rs 15,000 crores to March 26, 2020 (originally scheduled to be conducted on March 30, 2020)," a statement said.
Source: IANS
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