RBI to inject Rs 1.2 trillion under GSAP 2.0 in the September quarter


The Reserve Bank of India (RBI) will purchase bonds worth Rs 1.2 trillion in the September quarter under its G-Sec Acquisition Programme (GSAP) 2.0 as part of its efforts to ensure ample liquidity in the economy and keep government bond yields pinned lower. The central bank will also purchase bonds worth Rs 400 billion, including state development loans worth Rs 100 billion, under the ongoing GSAP 1.0 through an auction on June 17. The move will take RBI’s total acquisition of government bonds under the plan to Rs 650 billion. Reportedly, the announcement of the second GSAP programme comes in the backdrop of the government potentially borrowing an additional Rs 1.6 trillion over and above its budget estimate of Rs 12 trillion for the financial year to meet the shortfall in the GST compensation payable to states.