RBI Injects ₹50,000 Crore

This Open Market Operation (OMO) is a preemptive strike against an anticipated liquidity crunch. The system is bracing for significant outflows later this month due to quarterly advance tax and Goods and Services Tax (GST) payments, which historically tighten the availability of cash for banks. The central bank purchased a portfolio of seven government securities with maturities stretching from 2030 to 2053. Among the largest purchases were the 6.33% maturing in 2035 and the 6.01% bond maturing in 2030, which together accounted for over ₹27,000 crore of the total. This infusion is just the first half of a larger, planned liquidity boost. The RBI has already announced a second, identical ₹50,000 crore OMO purchase scheduled for March 13, bringing the total intervention to ₹1 lakh crore for the week. Since the start of the calendar year, the RBI has now injected a total of ₹2.50 lakh crore through such operations. The move comes as India's economy weathers the dual shock of rising energy costs and a depreciating currency. With India importing over 85% of its crude oil, every $10 per barrel increase in price is estimated to widen the Current Account Deficit (CAD) by about 0.36 percentage points and can push inflation up by 35-40 basis points. Open Market Operations are a direct tool for managing money supply. When the RBI buys these government bonds from commercial banks, it pays for them by crediting the banks' accounts. This directly increases the total cash reserves in the banking system, thereby easing liquidity and supporting lending activities. Interestingly, this injection comes at a time when the banking system is not in a deficit. Current estimates place the liquidity surplus at approximately ₹2.41 lakh crore, underscoring that the RBI's action is a forward-looking measure to ensure financial stability rather than a reaction to an existing crisis.