In order to infuse liquidity into the system, the Reserve Bank of India (RBI) on Friday bought government bonds worth Rs 8,471.45 crore under open market operations (OMO), as against a target of Rs 12,000.
While the government security (G-Sec) maturing 2017, with a coupon rate of 8.07 per cent, garnered over Rs 1,346.08 crore, the 7.8 per cent G-Sec maturing on 2021 garnered Rs 3,300.85 crore.
The 8.13 per cent G-Sec maturing 2022 mopped-up Rs 3,824.51 crore. The RBI has infused over Rs 41,210 crore in five tranches within the past few weeks.
OMOs are the first preference of the RBI to inject liquidity. There is an opportunity to raise up to Rs 2.74 lakh crore through the window.
The RBI also conducted bond auction to raise Rs 14,000 crore. The cut-off for auction of 8.79 per cent GOI 2021 was set at Rs 103.01, implying a yield of 8.33 per cent.
Meanwhile, bond yields softened across the maturities as bond cut-off yields at bond auction were in-line with the market expectations. The benchmark 10-year security 8.79 per cent GOI 2021 ended the day at yield of 8.22 per cent, against a close of 8.33 per cent seen yesterday.