On Thursday, the Reserve Bank of India (RBI) announced that it will carry out its fourth special open market operation (OMO) on 23 January, wherein, it will simultaneously purchase and sell government securities worth Rs 10,000 crore each.
At its third round of special OMO on 6 January, the central bank bought three long-term securities worth Rs 10,000 crore and sold three short-term bonds of the same amount.
"On a review of the current liquidity and market situation and an assessment of the evolving financial conditions, the Reserve Bank has decided to conduct simultaneous purchase and sale of government securities under Open Market Operations (OMO) for Rs 10,000 crores each on January 23, 2020 (Thursday)," RBI press release read.
"The eligible participants should submit their bids/offers in electronic format on the Reserve Bank of India Core Banking Solution (E-Kuber) system between 9:00 am and 11:00 am on January 23, 2020 (Thursday)," it added.
In December, RBI conducted its first-ever special OMO, which is similar to the 'Operation Twist' carried on by USA's central bank-the Federal Reserve- for over a decade, where it buys and sells securities of the same amount.
Through the operation, a central bank's objective is to manage the yield curve.