The Reserve Bank conduct open market operations to purchase government
bonds worth Rs 8,000 crore on August 30 to ease liquidity in the market. Based
on the current assessment of prevailing and evolving market conditions, the
Reserve Bank has decided to conduct open market operations by purchasing
Government securities for an aggregate amount of Rs 8,000 crore on August
30. The RBI will buy government securities maturing in 2025 (bearing interest
rate of 8.2%), 2026 (8.33%), 2032 (8.32%) and 2042 (8.3%). OMOs are
conducted by the RBI by way of sale/purchase of government securities to/from
the market with the objective of adjusting rupee liquidity conditions in the market
on a durable basis. The RBI sells securities to suck out excess liquidity. When
conditions are tight, the RBI buys securities from the market, releasing liquidity
into the market.
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