RBI to sell Rs 25,000 crore govt securities through OMO auction

The Reserve Bank of India said on Friday it would conduct an open market operation (OMO) sale auction of government securities worth Rs 25,000 crore on October 13. The auction forms part of the central bank's ongoing efforts to manage liquidity in the financial system.

OMO sales involve the RBI selling government securities from its portfolio to commercial banks and other eligible institutions. These operations are a key monetary policy tool used to absorb excess liquidity from the banking system and influence short-term interest rates.

The central bank regularly conducts OMO auctions as part of its liquidity management framework. The timing and size of such auctions are calibrated based on prevailing money market conditions and the RBI's assessment of system-wide liquidity requirements.

Detailed notification regarding the auction modalities, including the specific securities to be offered and other terms and conditions, is expected to follow from the central bank.