Updated: December 13, 2022, 04:43 PM IST
livemint
In April 2022, the Reserve Bank of India (RBI)… moreIn April 2022, the Reserve Bank of India (RBI) introduced the Standing Deposit Facility (SDF) as a mechanism to contain inflation by absorbing liquidity. The ‘Expert Committee on Revising and Strengthening the Monetary Policy Framework’ had advocated SDF as a liquidity management tool in January 2014. However, Section 17 of the RBI Act of 1934 was amended in 2018 to allow the RBI to introduce this instrument, which was now to be brought into action in 2022. The central bank’s decision to deploy the SDF poses an important dilemma, however, as the reverse repo rate can also be used to absorb liquidity. Let us begin this discussion by explaining what SDF is and how it is different from reverse repo facility. #reversereporate #standdepositfacility #rbi #finance #mint SUBSCRIBE NOW FOR LATEST UPDATES – https://tinyurl.com/lbw8nze