RBI sells Rs 25,000 crore government securities through OMO to manage liquidity

The Reserve Bank of India (RBI) on Monday sold Rs 25,000 crore worth of government securities through an Open Market Operation (OMO) auction as the central bank continued its liquidity management operations amid large foreign currency inflows, including those through Foreign Currency Non-Resident (Bank) deposits.

The auction attracted bids worth Rs 84,982 crore, more than three times the notified amount of Rs 25,000 crore. The RBI accepted the entire notified amount.

According to the RBI’s auction results, the central bank had notified securities worth Rs 25,000 crore, while participants submitted bids totalling Rs 84,982 crore. The RBI accepted bids for the full Rs 25,000 crore.

The auction is part of the RBI’s Rs 1 lakh crore OMO sale programme announced earlier this month to manage liquidity conditions.

Under the programme, the RBI is conducting three auctions — Rs 50,000 crore on September 17 and Rs 25,000 crore each on September 21 and September 28. With Monday’s auction, the central bank has completed Rs 75,000 crore of the planned sales.

An OMO sale absorbs rupee liquidity from the banking system as participants pay the RBI for the government securities.

The liquidity management operations come amid increased foreign exchange inflows under the RBI’s special USD-INR swap facility.

According to separate RBI data released on Monday, total inflows under the facility stood at USD 143.596 billion as of September 18. FCNR(B) deposits accounted for the largest share at USD 132.98 billion, while Overseas Foreign Currency Borrowings contributed USD 5.32 billion and External Commercial Borrowings USD 5.296 billion.

The RBI said it had introduced the special USD-INR Forex Swap facility covering FCNR(B) deposits, ECB and OFCB inflows on June 8, 2026. FCNR(B) deposits were mobilised until August 31, while the facility for ECB and OFCB inflows remains open until December 31.

In Monday’s OMO auction, the RBI accepted bids across five of the six government securities offered. It accepted Rs 11,512 crore in the 6.10 per cent GS 2031 and Rs 8,758 crore in the 7.95 per cent GS 2032, the two largest allocations.

The RBI rejected all bids for the 8.28 per cent GS 2027. Twenty bids worth Rs 3,082 crore were received for the security, but the amount accepted was nil. (ANI)