Mumbai: Reserve Bank on Wednesday said it will conduct a special 28-day term repo variable rate auction for Rs 20,000 crore on June 6, a move to provide liquidity to banks.
"...It has been decided to introduce special term repo auctions of 28-day tenor for a notified amount (Rs 20,000 crore) up to 0.25 percent of net demand and time liabilities (NDTL) of the banking system," RBI said in a statement.
The 28-day special term repo auction will usually be conducted on non-reporting Fridays, it said.
The reversal of the 28-day term repo will take place on Friday, July 4, it added.
Yesterday, RBI had said that a special term repo facility of 0.25 percent of NDTL to compensate fully for the reduction in access to liquidity under the export credit refinance (ECR) with immediate effect.
RBI had reduced the liquidity provided under the ECR facility from 50 percent of eligible export credit outstanding to 32 percent.
Besides, RBI reduced the statutory liquidity ratio (SLR), the mandatory amount of bonds lenders must park with central bank, by 0.5 percent to 22.5 percent of their NDTL with effect from June 14.
