RBI Liquidity Infusion of ₹1.9 Lakh Crore in March 2025
Why in the news
With banks short of liquidity, the Reserve Bank of India said it would add about ₹1.9 lakh crore to the system in March using bond purchases and dollar-rupee swaps.
Key facts
- OMO auctions: ₹60,000 crore of government securities, in three tranches.
- USD/INR buy-sell swaps: of $5 billion and $10 billion.
- Banks had approached RBI for extra support as liquidity tightened.
- Rupee on 5 March 2025: up 0.36% to 86.96 per USD, helped by a weaker dollar, RBI action through state-owned banks and a positive mood for Asian currencies.
| Period | Rupee depreciation |
|---|---|
| FY25 | 4.09% |
| Calendar year 2025 | 1.55% |
Global factors and outlook
- US tariffs of 25% on Mexico and Canada, and Chinese duties doubled to 20%, cloud US growth and inflation.
- Short term: rupee keeps an appreciation bias.
- Longer term: may slip towards ₹88-89 per dollar if a rate cut comes in April.
Exam angle
- OMO: RBI buying or selling government securities to manage liquidity.
- Total infusion: ₹1.9 lakh crore.