RBI to sell ₹25,000 cr of government bonds Tuesday
The RBI is stepping in to tackle extra cash floating around in banks by selling ₹25,000 crore worth of government bonds this Tuesday.
This move comes right after its first policy rate hike in almost four years, aiming to keep things balanced in the financial system.
The bonds will mature between 2030 and 2035, with interest rates ranging from 6.10% to 7.95%.
Banks' ₹7L/cr surplus set to shrink
Banks have had a huge surplus (over ₹7 lakh crore) since September, but that's expected to shrink soon.
By selling these bonds, the RBI hopes to bring long- and short-term interest rates closer together and keep the banking system steady.
Governor Sanjay Malhotra says a large amount of the extra liquidity would be absorbed within the current financial year, which ends in March, showing how serious the RBI is about keeping markets stable.