In an effort to support the economic growth, India’s central bank is likely to conduct at least one more swap of rupees for dollars after the general elections, said three officials with the straight acquaintance of the plan.
Also, in order to inflate the quantitative easing programme to encourage the slowing economy, Reserve Bank of India plans to conduct open market operations of up to Rs 500 billion over the next two months, one of the officials said.
“We want to make sufficient liquidity available, but we cannot open the floodgates of liquidity. It has to be done in a calibrated and measured way,” said one of the officials who requested anonymity because of the sensitivity of the matter. However, RBI has declined to comment.
These moves would significantly help decrease the interest rates and is expected to increase cash in the financial system of the economy.
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