The Reserve bank of India has announced about conducting special simultaneous purchase and sale of government securities (G-Secs) under Open Market Operation (OMO) for an aggregate amount of Rs.10000 crore each on September 10, 2020.

An Open Market Operation (OMO) is an activity by a central bank to give/take liquidity in its currency, to or from a bank (or a group of banks). In this process, a central bank either buys or sells government bonds in an open market or enters into a repo or secured lending transaction with a commercial bank. The central bank gives the money as a deposit for a defined period and synchronously takes an eligible asset as collateral. A central bank uses OMO as the primary means of implementing monetary policy.

RBI will purchase three government securities: 7.72% G-sec 2025; 6.97% G-sec 2027; and 5.79% G-sec 2030 – aggregating Rs.10000 crore. It will simultaneously sell three 182 day Treasury bills maturing on October 22, October 28, and November 6, 2020, aggregating Rs.10000 crore. In both the aforementioned transactions, there is no security-wise notified amount. The RBI also said that it remains committed to further such operations as warranted by market conditions.