RBI Injects ₹50,000 Crore Liquidity Through OMO Purchase of Government Securities

Reserve Bank of India (RBI) injected ₹50,000 crore of durable liquidity into the banking system through an open market operation (OMO) purchase of government securities on March 9, 2026. This operation marks the first tranche of the central bank’s planned ₹1 lakh crore liquidity infusion scheduled for this week.

Through the auction, the RBI purchased a basket of seven government bonds to ensure adequate liquidity in the financial system. OMO purchases involve the central bank buying government securities from the market, thereby injecting money into the banking system and improving liquidity conditions.

Details of the Bonds Purchased

The bonds purchased in the auction included the 6.01% government security maturing in 2030, 6.10% GS 2031, 7.18% GS 2033, 6.19% GS 2034, 6.33% GS 2035, 6.92% GS 2039, and 7.30% GS 2053.

Among these, the largest purchase was in the 6.33% government security 2035, where the RBI accepted bids worth ₹13,507 crore. This was closely followed by the purchase of ₹13,494 crore worth of the 6.01% GS 2030 bond. The cut-off yields in the auction ranged from 6.2757% for the 2030 bond to 7.3387% for the longer-term 2053 bond.

These purchases help ensure smooth functioning of the government securities market while supporting liquidity conditions in the banking sector.

Part of a Larger Liquidity Infusion Plan

The OMO purchase is part of the RBI’s broader plan announced on March 6 to buy government securities worth ₹1,00,000 crore in two tranches of ₹50,000 crore each. The second tranche of the OMO auction is scheduled to take place on March 13, 2026.

The central bank said the decision to conduct these operations was taken after reviewing prevailing liquidity and financial market conditions. The move also comes ahead of expected outflows from the banking system due to advance tax and Goods and Services Tax (GST) payments later in the month.

Currently, the liquidity in the banking system is estimated to be in surplus of around ₹2.41 lakh crore.

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Conclusion

The RBI’s OMO purchase operation reflects its proactive approach to maintaining comfortable liquidity conditions in the banking system. By injecting ₹50,000 crore through government bond purchases, the central bank aims to ensure stability in financial markets and support smooth credit flow amid anticipated tax-related liquidity outflows.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a private recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.