RBI to infuse Rs 12000 crore into market this week

Mumbai: The Reserve Bank of India will pump in Rs 12,000 crore in the market later this week by buying government securities.

"Consistent with the stance of monetary policy and based on the current assessment of prevailing and evolving liquidity conditions, the RBI has decided to conduct Open Market Operations (OMOs) by purchasing the following government securities for an aggregate amount of Rs 12,000 crore on May 25, 2012," it said in a statement.

As part of the OMOs, the RBI will purchase government securities maturing in 2020 (bearing interest rate of 8.19 per cent), 2024 (9.15 per cent), 2027 (8.26 per cent) and 2030 (8.97 per cent).

The auction, it added, would be held through the multi-security auction using the multiple price method.

The RBI had last week pumped in Rs 11,128 crore in the system through the OMOs as against the notified amount of Rs 12,000 crore.

The central bank has been using the OMOs tool, under which it purchases government securities from banks and other institutions to improve the liquidity situation.