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The Reserve Bank of India (RBI) received good response from banks on Monday to its ‘Operation Twist’, entailing buying longer-dated bonds from banks and selling them shorter-dated ones.
The central bank received bids aggregating ₹64,746 crore at the open market operation (purchase) of four Government Securities (G-Secs), maturing in six to 10 years, against the notified amount of ₹10,000 crore.
The RBI received bids aggregating ₹50,260 crore at the open market operation (sale) of securities (cash management bills and treasury bills) maturing in the next couple months to a year, against the notified amount of ₹10,000 crore.
The ‘Operation Twist’ is aimed at correcting yields at the short-end, which came down sharply on account of the long-term repo operations conducted by the RBI, and the long-end of the Government Security, which went up, yield curve.
On Monday, the yield on the benchmark 6.45 per cent G-Sec maturing in 2029 came down a shade to close at 6.1527 per cent against Friday’s close of 6.1710 per cent, while that on the short-term G-Sec (7.37 per cent 2023 paper) went up a tad to 4.6655 per cent from 4.6539 per cent.
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