Open market operations: RBI purchases Rs 10,000 crore G-secs

Mumbai :The Reserve Bank of India (RBI) announced the purchase of government securtities (G-secs) under open market operations (OMO). The move came after the assessment of prevailing liquidity conditions, a press release by the RBI said.
The RBI plans to raise an aggregate of Rs 10,000 crore on July 19 through multi-security auction using the multiple price method. However, the security wise breakdown of the amount was not given.
There are a total of five categories of dated G-secs. Namely, 8.27 per cent GS 2020 maturing on June 9, 2020. Second category, the 8.20 per cent GS 2022 maturing on February 15, 2022 . Next being the 7.35 per cent GS 2024 which becomes due on June 22, 2024, followed by the 8.33 per cent GS 2026 which expires on July 9, 2026 and the 7.61 per cent GS 2030 paper maturing on May 09, 2030.
The auction results will be announced on the day of the issue itself. Successful participants should ensure availability of requisite amount of securities in their SGL account by 12 noon on July 20.
Vijay Sharma, senior executive vice president at PNB Gilts, said the market has been expecting OMOs and this notification has come in line with that, “Thse OMO operations will now be a regular phenomenon just like the market has been expecting it. Post this OMO settlement, the benchmark yield will soften by around three basis points,” Sharma explained. In a similar OMO purchase last month, the RBI had notified it would raise Rs 10,000 crore, for which it had received just over Rs 40,000 crore. —FE