Mumbai: The Reserve Bank on Tuesday said it will purchase government securities worth Rs 1 lakh crore and conduct a USD 10 billion buy/sell dollar-rupee swap auction to inject liquidity into the banking system. In a statement, the RBI said it will conduct OMO (Open Market Operations) purchase auctions of the central government securities for an aggregate amount of Rs 1,00,000 crore in two tranches of Rs 50,000 crore each on January 29 and February 5.
Earlier, the central bank had announced that the auctions would be conducted on February 5 and February 12. In another release, the central bank said it will be conducting a USD/INR Buy/Sell swap auction of USD 10 billion for a tenor of three years on February 4.
The swap will be in the nature of a simple buy/sell foreign exchange swap from the Reserve Bank side. A bank shall sell US dollars to the Reserve Bank and simultaneously agree to buy the same amount of US dollars at the end of the swap period.
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