The Reserve Bank will purchase government securities for a total Rs 10,000 crore on Wednesday to inject liquidity into the market. This will be the first open market operations (OMO) of the calendar year 2016. The central bank conducts OMO purchases in order to infuse liquidity into the system whenever there is a deficiency, while it conducts OMO sales to suck excess liquidity from the system.
The RBI has offered four securities for OMO purchase — the 7.28% bonds maturing in 2019, 8.83% bond maturing in 2023, 7.72% bond maturing in 2025 and 7.88% bond maturing in 2030. The central bank said there is no security-wise notified amount.
The last time the RBI conducted an OMO purchase was on December 7 when it bought Rs 10,000 crore worth bonds from the market. It had conducted OMO sales worth Rs 8,270 crore in July 2015.