Again the RBI TWISTS; announced yet another round of OMOs

The auctions are going to be endured August twenty seven and Gregorian calendar month 03 this year, the tally aforesaid.

In a bid to lower interest rates on long-run government bonds, the banking concern of India (RBI) on weekday, August 25, aforesaid that it’s set to conduct concurrent purchase ANd sale of presidency securities below Open Market Operation (OMO) for an mixture quantity of ₹20,000 crores in 2 tranches of ₹10,000 crores every.

The auctions are going to be endured August 27 and Gregorian calendar month 03 this year, the tally aforesaid.

The tally conjointly adscititious that it’ll purchase government securities as well as half-dozen.18 per cent, 8.24 per cent, 5.79 per cent and 7.95 per cent maturing on November four, 2024, February fifteen, 2027, May 11, 2030 and August 28, 2032, severally.

RBI to conduct another tranche of Operation Twist over next 2 weeks

While the tally can sell securities that mature between October 2020 and November 2020.

“Eligible participants should submit their bids/offers in electronic format on the Reserve Bank of India Core Banking Solution (E-Kuber) system between 10:00 am and 11:00 am on August 27, 2020,” the RBI stated. Meanwhile, the financial organization conjointly aforesaid that the results of the auction are going to be proclaimed on identical day.

In the bond market, the central bank’s OMOs under which bonds are simultaneously purchased and sold is known as ‘Operation Twist’.

Under the Open Market Operation, the RBI buys long-run bonds and sells short government securities (G-Secs) at the same time.

Earlier in October, the tally had conducted OMO price Rs 10,000 large integer to take care of liquidity.

With the intensifying of the novel coronavirus pandemic risks, the tally aforesaid that it’ll still perpetually review current and evolving liquidity and market conditions and take measures as acceptable to make sure the orderly functioning of monetary markets.