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RBI Sets MSS Intervention Ceiling at Rs 50,000 Crore

Under the MSS, the RBI, on behalf of the government, absorbs liquidity by issuing Treasury Bills and/or dated securities.

Published: 21st April 2015 10:32 PM  |   Last Updated: 21st April 2015 10:32 PM   |  A+A-

RBI
By PTI

MUMBAI: The Reserve Bank (RBI) has fixed the quantum of intervention through the Market Stabilisation Scheme (MSS) at Rs 50,000 crore for the current fiscal to manage liquidity.

Under the MSS, the RBI, on behalf of the government, absorbs liquidity by issuing Treasury Bills and/or dated securities.

"This ceiling will be reviewed when the outstanding balance reaches the threshold limit of Rs 35,000 crore. The current MSS outstanding balance is nil," it added.

The government, in consultation with the RBI, had launched the MSS in 2004 to absorb excess liquidity arising out of significant foreign exchange inflows.

The government issues Treasury Bills and/or dated securities under the MSS in addition to its normal borrowing requirements.

The government plans to borrow Rs 6 lakh crore from the market this fiscal. Of the total, Rs 3.6 lakh crore will be raised in the first half.



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