Open Market Operations and Dollar-Rupee Swaps

  • In December 2025, the RBI utilised strategic Dollar-Rupee swaps and Open Market Operations (OMO) to manage excessive systemic liquidity and moderate rupee volatility.
  • Open Market Operations involve the outright purchase or sale of Government Securities to regulate the money supply.
  • These operations help the RBI align the weighted average call rate with the target policy repo rate.
  • The RBI uses OMOs to influence long-term interest rates and maintain stability in the domestic bond market.
  • Strategic liquidity management ensures that the banking system has sufficient funds to support productive economic credit growth.

Forex Management and Structural Distinctions

  • Dollar-Rupee swaps allow the RBI to manage liquidity ....
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