OMO
- August 26, 2020
- Posted by: OptimizeIAS Team
- Category: DPN Topics
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Subject: Economy
Context:
The Reserve Bank of India announced that it will conduct open market operations or OMO of government t securities worth ₹20,000 crore in two tranches.
Concept:
- Open market operation is the sale and purchase of government securities and treasury bills by RBI without printing new currency.
- Open market operation is a tool that the RBI uses to smoothen liquidity conditions through the year and regulate money supply in the economy.
- RBI carries out the OMO through commercial banks and does not directly deal with the public.