E-Paper
RBI to buy govt bonds worth ₹25,000 crore under G-SAP 2.0 today
In his statement after the Monetary Policy Committee meeting, Das had announced two auctions of ₹25,000 crore each under G-SAP 2.0. The first one was held on August 12.
The Reserve Bank of India (RBI) will conduct an open market purchase of government securities of ₹25,000 crore on Thursday. This will be done under the G-sec Acquisition Programme (G-SAP 2.0).
According to RBI governor Shaktikanta Das, these purchases are being done to support the market. He also said that G-SAP has been successful in anchoring yield expectations while eliciting keen response from market participants.
In his statement after the Monetary Policy Committee meeting, Das had announced two auctions of ₹25,000 crore each under G-SAP 2.0. The first one was held on August 12.
The central bank issued a statement on Wednesday in which it said that five government securities will be purchased on Thursday. The result of the auctions will be announced on the same day.
What is G-SAP?
The government raises money from the market to fund its fiscal deficit through dated securities and treasury bills.
Under G-SAP, RBI commits to a specific amount of open market purchases of government securities with a view to enabling a stable and orderly evolution of the yield curve amidst comfortable liquidity conditions.
G-SAP is running alongside RBI's regular operations including Liquidity Adjustment Facility (LAF), open market operations (OMOs) and Operation Twist.
