OMO transactions regulate liquidity in market

Q.  What does RBI regulate through Open Market Operation Transactions?
- Published on 20 Jul 15

a. Flow of Foreign Direct Investment
b. Borrowing powers of the banks
c. Inflation
d. Liquidity in economy

ANSWER: Liquidity in economy
 
Outright purchase and Repurchase agreement are the two traditional type of OMO's used by RBI.

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