Mumbai, January 24, 2026
The Reserve Bank of India (RBI) on Friday announced that it will inject more than ₹2 trillion (₹2 lakh crore) of liquidity into the banking system, a move aimed at easing financial conditions and ensuring adequate funds for lenders.
In a statement, the central bank said the decision was taken after reviewing prevailing liquidity and financial market conditions. The measure is expected to support credit flow and maintain stability in the banking system.
🏦 RBI to Buy Government Bonds via Open Market Operations
As part of the liquidity infusion, the RBI will conduct open market operations (OMOs) to purchase government securities worth ₹1 trillion (₹1 lakh crore).
According to the RBI:
₹500 billion worth of bonds will be purchased on February 5
Another ₹500 billion will be bought on February 12
These bond purchases will directly inject durable liquidity into the system, providing banks with additional funds and easing short-term cash constraints.
💰 Objective: Ease Liquidity Conditions
The RBI said the move is designed to address tight liquidity conditions and ensure smooth functioning of financial markets. By purchasing government bonds from banks and financial institutions, the central bank releases cash into the system, improving lending capacity.
Market participants view the step as a supportive monetary measure, particularly amid evolving economic and credit conditions.
📊 Impact on Banks and Markets
The liquidity injection is expected to:
Improve banks’ cash positions
Support credit growth
Stabilize money market rates
Enhance overall financial system liquidity
Analysts say the move signals the RBI’s intent to remain proactive in managing liquidity while balancing inflation and growth concerns.
