RBI's Bold Move: Boosting Bank Liquidity with OMO and Forex Swaps

The Reserve Bank of India plans to purchase government securities worth Rs 2 lakh crore and execute a USD 10 billion dollar-rupee swap auction to enhance banking system liquidity. These actions will span from December 29, 2025, to January 22, 2026, with four tranches planned for OMO purchases.

The Reserve Bank of India (RBI) has unveiled a strategic plan to reinforce liquidity within the banking sector. This initiative includes acquiring government securities totaling Rs 2 lakh crore and conducting a USD 10 billion dollar-rupee swap auction.

The operations, slated between December 29, 2025, and January 22, 2026, are designed to stabilize market conditions. The RBI will monitor ongoing liquidity trends to ensure stability and take further actions as needed.

Breakdown of operations involves four OMO purchase tranches and a straightforward buy/sell forex swap on January 13, 2026, underscoring the RBI's commitment to monetary stability.

(With inputs from agencies.)