The Reserve Bank of India (RBI) has decided to to advance the first of the two variable rate term repo auctions to March 26 from March 30.
The central bank had announced two such auctions of ₹25,000 crore each on March 30 and March 31 to address the additional demand for liquidity.
“On a review of the rapidly evolving financial conditions and taking into account the impact of disruptions caused by COVID-19, it has been decided to advance the first auction scheduled for March 30, 2020 to March 26, 2020” the RBI said in a statement.
There is no change in the auction scheduled for March 31, 2020.
“As a special case, standalone primary dealers (SPDs) were also allowed to participate in these auctions along with other eligible participants,” the central bank said in the statement.
It has been decided to temporarily enhance liquidity available to SPDs under the Reserve Bank’s Standing Liquidity Facility (SLF) from ₹2,800 crore to ₹10,000 crore with immediate effect, in order to facilitate year-end liquidity management by SPDs. This enhanced facility will be available till April 17, 2020, the RBI said.