RBI says ‘closely monitoring’ situation, will take measures for market stability amid coronavirus outbreak

The Reserve Bank of India (RBI) on Friday said it is closely monitoring the current global situation and assured that it will take all steps to keep markets adequately liquid and stable.

The statement comes at a day when trading on the Indian stock exchanges hit a “circuit breaker” — first time since 2008 — as soon as markets opened on Friday. “The RBI is closely and continuously monitoring the rapidly evolving global situation and will take all necessary measures to ensure that money, debt and forex markets remain adequately liquid and stable, and continue to function normally,” the RBI said in a statement.

Both Sensex and Nifty plunged over 10 per cent in the opening session, hitting their lower circuit levels, as new coronavirus-led recession fears triggered panic selling in the market.

Stock exchanges had halted trading for 45 minutes within 15 minutes of market opening. Normal trading resumed around 1030 hours.

In the currency markets, the Indian rupee recovered sharply to trade 46 paise higher at 73.82 against the US dollar. At open, the rupee fell to a record low of 74.5075 against the US dollar.

The RBI also announced to infuse an additional short-term liquidity of Rs 25,000 crore in to the system to counterbalance the domestic liquidity effects on account of dollar sell-buy swap on Friday.

It conducted Rs 25,000 crore of a variable rate repo auction with a 7-day tenor. On Thursday, the RBI had announced to undertake six-month US dollar sell/buy swaps to provide liquidity to the foreign exchange market amid evolving financial market conditions and taking into consideration the requirement of US dollars in the market. To start with, an amount of USD 2 billion would be offered on March 16, 2020.

The swap will be in the nature of a simple sell/buy foreign exchange swap from the Reserve Bank side.

A bank will buy US Dollars from the RBI and simultaneously agree to sell the same amount of US Dollars at the end of the swap period. The RBI also said the minimum bid size for the swap auction will be USD 10 million and in multiples of USD 1 million thereafter.

Click to comment

Leave a Reply

Your email address will not be published.

nine + nine =

News is information about current events. News is provided through many different media: word of mouth, printing, postal systems, broadcasting, electronic communication, and also on the testimony of observers and witnesses to events. It is also used as a platform to manufacture opinion for the population.

Contact Info

D 601  Riddhi Sidhi CHSL
Unnant Nagar Road 2
Kamaraj Nagar, Goreagaon West
Mumbai 400062 .

Email Id: [email protected]

West Bengal

Eastern Regional Office
Indsamachar Digital Media
Siddha Gibson 1,
Gibson Lane, 1st floor, R. No. 114,
Kolkata – 700069.
West Bengal.

Office Address

251 B-Wing,First Floor,
Orchard Corporate Park, Royal Palms,
Arey Road, Goreagon East,
Mumbai – 400065.

Download Our Mobile App

IndSamachar Android App IndSamachar IOS App
To Top
WhatsApp WhatsApp us