RBI Announces special Open Market Operation (OMO) Purchase and Sale of Government of India Dated Securities
- The Reserve Bank has decided to conduct simultaneous purchase and sale of government securities under Open Market Operations (OMO) for ₹10,000 crores each.
- This has been done after a review of the current liquidity and market situation and an assessment of the evolving financial conditions.
- The RBI will buy ₹10,000 crore of 6.45% government bonds maturing in 2029 and simultaneously sell ₹10,000 crore of short-term bonds maturing in 2020.
Purchase
The Reserve Bank will purchase the following security using the multiple price auction method:
| Sr. No | Security | Date of Maturity | Aggregate Amount |
| 1 | 6.45% GS 2029 | 07-Oct-2029 | ₹10,000 crores |
Sale
The Reserve Bank will also sell the following securities using the multiple price auction method:
| Sr. No | Security | Date of Maturity | Aggregate Amount |
| 1 | 6.65% GS 2020 | 09-Apr-2020 | ₹10,000 crores (There is no security-wise notified amount) |
| 2 | 7.80% GS 2020 | 03-May-2020 | |
| 3 | 8.27% GS 2020 | 09-Jun-2020 | |
| 4 | 8.12% GS 2020 | 10-Dec-2020 |
This Move by RBI is trending on social media with the name “Operation Twist”. Operation Twist is a move taken by U.S. Federal Reserve in 2011-12 to make long-term borrowing cheaper.
Points to remember:
- RBI has announced a special Open Market Operation (OMO) Purchase and Sale of Government of India Dated Securities for what amount?