RBI steps in to ease liquidity strain, buys Rs 50,000 crore of bonds — What it means for banks and borrowers?

The RBI has begun injecting liquidity into the financial system with a Rs 50,000-crore bond purchase, the first of two OMOs announced last week. The step comes amid tightening liquidity caused by the central bank’s dollar sales and seasonal cash demand. With a Rs 1-trillion bond programme and a $5-billion FX swap scheduled, the RBI aims to stabilise money-market conditions, support credit flow and prevent interest rates from rising unexpectedly.