The Reserve Bank of India (RBI) has decided to infuse ₹10,000 crore liquidity in the banking system by buying government securities through open market operations (OMO).
The central bank will conduct open market operations on March 20, 2020 to purchase ₹10,000 crore of government securities through a multi-security auction using the multiple price method.
“With the heightening of COVID-19 pandemic risks, certain financial market segments have been experiencing a tightening of financial conditions as reflected in the hardening of yields and widening of spreads,” the RBI said.
“It is important to ensure that all market segments remain liquid and stable, and function normally,” the Reserve Bank said, amid heightened volatility in the financial markets due to the spread of the COVID-19.
