Mumbai: The Reserve Bank on Friday said it will inject 40,000 crore into the system in November through the purchase of government securities as it looks to meet festive season demand for funds. The central bank had already injected 36,000 crore into the system in October through open market operation (OMO).

“Based on an assessment of the durable liquidity needs going forward, RBI has decided to conduct purchase of Government securities under OMOs for an aggregate amount of 40,000 crore in the month of November 2018," the central bank said in a release.

The auction dates and the government securities to be purchased in respective auctions would be communicated in due course, it added. “The OMO amount stated ... is indicative and RBI retains the flexibility to change it, depending on the evolving liquidity and market conditions."

The Reserve Bank of India (RBI) had earlier stated that the system liquidity would move into deficit in the second half of 2018-19 and evolving liquidity conditions would determine its choice of instruments for both transient and durable liquidity management.

This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.

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