The Reserve Bank of India (RBI) today announced it will purchase government securities worth Rs 10,000 crore tomorrow through open market operations (OMO) to infuse liquidity in the cash strapped system. The OMO auction will alleviate the cash crunch caused due to last minute tax payment as the fiscal year comes to an end on March 31. Banks have been borrowing heavily from RBI over the past few weeks as liquidity remains tight in the system. Banks borrowing under the Liquidity Adjustment Facility (LAF) stood at Rs 1.61 lakh crore today.

Source - http://www.business-standard.com