RBI to conduct simultaneous purchase & sale of government securities under OMO for Rs 10,000 crore each on September 10

The Reserve Bank of India (RBI) will conduct simultaneous purchase and sale of government securities under the Open Market Operation (OMO) for Rs 10,000 crore each on September 10. The central bank today said it would be selling three securities totalling Rs 10,000 crore and also purchasing an equal number of securities of the same amount.

The result of the auctions will be announced on the same day. It added, the successful participants should ensure availability of funds/securities in their Current account/SGL account, as the case may be, by noon on September 11, 2020.

RBI in a tweet said, "RBI Announces Special Open Market Operations (OMO) Simultaneous Purchase and Sale of Government of India Securities."

Simultaneous purchase and sale of government securities under OMOs, popularly known as Operation Twist, involves purchasing G-Sec of longer maturities and selling an equal amount of G-Sec of shorter maturities.

In the notification, Reserve Bank said that it reserves the right to

    ♦    Decide on the quantum of purchase/sale of individual securities.

    ♦    Accept bids/offers for less than the aggregate amount.

    ♦    Purchase/sell marginally higher/lower than the aggregate amount due to rounding-off.

    ♦    Accept or reject any or all the bid/offers either wholly or partially without assigning any reasons.

Eligible participants should submit their bids/offers in electronic format on the Reserve Bank of India Core Banking Solution (E-Kuber) system between 10:00 am and 11:00 am on September 10, 2020.