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RBI does whatever it takes to make banks, markets Covid-19 resistant

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MUMBAI: Financial stability is back on the centre stage. The Reserve Bank of India (RBI) on Friday said it wants to “preserve financial stability", even as it gave several antidotes for the markets and lenders to fight the impact of Covid-19 crisis.

India’s lenders have been given access to ₹3.74 trillion potential liquidity at a 75 basis points lower cost than before. This flood comes even as systemic liquidity is already at a large surplus of over ₹2 trillion.

But the RBI has made sure that this money reaches to where it is intended to go, at least to some extent. Of the ₹3.74 trillion, ₹1 trillion has to be deployed into investment grade corporate bonds by banks.

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