2 days ago
RBI Absorbs ₹25,000 Crore in Second OMO Bond Sale
Banks had much more cash than they needed.
The Reserve Bank of India wanted to remove some of that extra cash.
It sold government bonds to banks and other investors.
These buyers paid the RBI, which reduced the amount of money available in the banking system.
The RBI accepted bids worth ₹25,000 crore in the second sale.
The banking system’s surplus liquidity was estimated at ₹6.05 lakh crore on September 20.
Extra money came partly from foreign-currency deposits and government spending on salaries and pensions.
Another ₹25,000-crore bond sale was planned for September 28.
The Reserve Bank of India accepted bids worth ₹25,000 crore in the second tranche of its OMO government bond sale.
The accepted securities included government bonds maturing between 2029 and 2032, while no bids were accepted for the 8.28% GS 2027.
The banking system had an estimated liquidity surplus of ₹6.05 lakh crore as of September 20.
The RBI announced total OMO sales of ₹1 lakh crore across three tranches to manage surplus liquidity.
The final ₹25,000-crore tranche was scheduled for September 28.
- Who
- The Reserve Bank of India, banks, and other investors.
- What
- The RBI accepted ₹25,000 crore in bids during the second tranche of an open market operation bond sale.
- Where
- Mumbai and the Indian banking system.
- When
- September 21; the final ₹25,000-crore tranche was scheduled for September 28.
- Why
- To absorb surplus liquidity created by foreign-currency deposit inflows, RBI swaps, and government spending.
Key facts
- Second OMO sale
- ₹25,000 crore of bids accepted
- Total announced OMO sales
- ₹1 lakh crore in three tranches
- Liquidity surplus
- Approximately ₹6.05 lakh crore as of September 20
- Largest accepted security
- ₹11,512 crore of the 6.10% GS 2031
- Rejected security bids
- No bids accepted for the 8.28% GS 2027
- Next tranche
- ₹25,000 crore scheduled for September 28
Sources
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