Reserve Bank of India gets bid – Reserve Bank of India Gets Bid

The Reserve Bank of India on Thursday received bids worth Rs 1.87 lakh crore against the notified amount of Rs 40,000 crore in the Open Market Operation (OMO) procurement auction.

The market stakeholders said that due to high demand, the cut-off price of scheduled bonds was determined below the price of the secondary market. A primary dealership dealer said that there was a natural demand in the auction given cash shortage. He said that government banks were large stakeholders.

The Reserve Bank has so far purchased government securities worth Rs 1 lakh crore through the OMO auction. The central bank also organized a screen -based OMO, in January, securities worth Rs 58,875 crore were purchased. Along with this, the central bank also intervened in the government securities market and bought bonds worth Rs 39,000 crore from the secondary market.

Market stakeholders said that all these intervention are part of the Reserve Bank’s exercise to put sustainable cash in the banking system.
Bond market hopes that additional OMO auction will be held, as the banking system has been in constant cash shortage for the last 9 weeks. The latest data of the Reserve Bank shows that there was a net shortage of Rs 1.77 lakh crore in the banking system on Wednesday.

First Published – February 20, 2025 | 10:26 PM IST