RBI to pump in Rs 12k cr into mkt

The Reserve Bank of India on Saturday announced that it will pump in Rs 12,000 crore in the market later in the week by buying government securities to ease the liquidity situation.

"...based on the current assessment of prevailing and evolving liquidity conditions, the RBI has decided to conduct Open Market Operations (OMOs) by purchasing the following government securities for an aggregate amount of Rs 12,000 crore on May 18, 2012," it said in a statement.

As part of the OMOs, the Reserve Bank of India (RBI) will purchase government securities maturing in 2018 (bearing interest rate of 8.24 per cent), 2021 (8.79 per cent), 2022 (8.08 per cent) and 2027 (8.28 per cent).

The auction, it added, would be held through the multi-security auction using the multiple price method.

The RBI had last week pumped in Rs 9,757 crore in the system through the OMOs as against the notified amount of Rs 12,000 crore.

The central bank has been using the OMOs tool, under which it purchases government securities from banks and other institutions to improve the liquidity situation.

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