Additional instrument for RBI to manage liquidity operations
Megha Jain
Content Head
To attain greater flexibility in its liquidity operation, Reserve Bank of India will soon get one more tool 'Standing Deposit Facility Scheme' to its kit. There are arrays of instruments that RBI uses when the Liquidity Adjustment Facility is beyond the comfort zone and these instruments include cash reserve ratio, open market operations and MSS. SDF will be added to this list for sterilization operations.
