Open Market Operations by the RBI refers to the sale and purchase of ______.
Government securities
Open Market Operations are one of the key quantitative tools used by the Reserve Bank of India to regulate liquidity in the economy. In an OMO, the RBI buys or sells securities in the open market to inject or absorb money from the banking system.
The instruments bought and sold during OMOs are government securities such as treasury bills and dated government bonds, not foreign currency, fixed assets or bullion. Hence, Government securities.
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