The Reserve Bank to purchase government securities (G-secs) worth Rs 10,000 crore on September 19, a move aimed at inducing liquidity in the system. The purchase of the government securities will be done through Open Market Operations (OMO).
When the RBI thinks there is excess liquidity in the market, it resorts to the sale of securities, thereby decreasing the rupee liquidity. Similarly, when the liquidity conditions are tight, it may buy securities from the market, thereby increasing liquidity in the market.
Source- News on Air
- Urjit Patel- 24th Governor of RBI, Headquarters- Mumbai, Established on- 1st April 1935, in Kolkata.