RBI to continue daily auction 9 pc 14-day repo

Mumbai, Oct 15: The Reserve Bank of India (RBI) on Wednesday, Oct 15 announced that it will continue daily till further notice the nine per cent fixed rate special repo facility against eligible securities for Rs 20,000 crore.

The RBI had evoked its option for such special Liquidity Adjustment Facility (LAF) yesterday to enable banks to meet the liquidity requirements of Mutual Funds. Four Banks had utilised to the tune of Rs 3,500 crore on Tuesday, Oct 14. RBI in a release here said that the 14-day repo facility will now be conducted everyday until further notice up to a cumulative amount of Rs 20,000 crore.

To enable the Mutual Funds gain more liquidity to meet their redemption requirements, RBI had yesterday withdrew for 15 days the restriction on borrowing by Mutual Funds on certificate of deposits.

UNI