RBI to conduct revised Additional LAF on March 31

Mumbai, Mar 30 (UNI) At the request of the market participants, the Reserve Bank of India (RBI) would conduct an additional Liquidity Adjustment Facility (LAF) on March 31, 2007.

Under this LAF, repo/reverse repo bids would be received between 1530 hrs to 1600 hrs from eligible LAF participants for a period of 3-days, with reversal on April 3, 2007.

The features of the additional LAF would remain the same as those of the daily LAF in all its operational aspects. In accordance with the modified arrangements, the reverse repo absorptions would be limited to a maximum of Rs 3,000 crore under the additional LAF, a RBI release here said.

It may be noted that with a view to facilitating accounting for the Government transactions of the current financial year (2006-07) by March 31, 2007, the Reserve Bank has in consultation with Controller General of Accounts, Government of India, had on March 23, 2007, already announced special measures in regard to conduct of Government transactions. In this context, the additional LAF would provide eligible LAF participants a facility to adjust their liquidity mismatches arising from the special clearing arrangements being made in view of government transactions, the release added.

UNI