Reserve Bank of India (RBI) cuts repo rate and injects durable liquidity through OMO and dollar-rupee sell swap.

Key facts

• Reserve Bank of India (RBI) Governor Sanjay Malhotra announced a 25 basis points repo rate cut.
• RBI will conduct Open Market Operation (OMO) purchases of government securities worth Rs 1 trillion.
• RBI announced a three-year dollar-rupee buy/sell swap of $5 billion to inject durable liquidity into the financial system.
• The dollar-rupee sell swap is a foreign exchange transaction where banks sell US Dollars to RBI in return for Indian Rupee.
• The combined measures aim to ensure adequate, durable liquidity and facilitate monetary transmission.