BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Securities and Exchange Board of India
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Reserve Bank of India
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National Bank for Agriculture and Rural Development
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Insurance Regulatory and Development Authority of India
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Detailed explanation-1: -The Reserve Bank of India (RBI) on Tuesday conducted a $ 5 billion dollar-rupee swap auction as part of its liquidity management initiative, leading to infusion of dollars and sucking out of the rupee from the financial system. The central bank’s move will reduce the pressure on inflation and strengthen the rupee.
Detailed explanation-2: -Recently, the Reserve Bank of India (RBI) conducted a USD 5 billion dollar-rupee swap auction as part of its liquidity management initiative. This move will lead to infusion of dollars and sucking out of the rupee from the financial system. This will reduce the pressure on inflation and strengthen the rupee.
Detailed explanation-3: -In a Dollar–Rupee buy/sell swap, the central bank purchases dollars (US dollars or USD) from banks in exchange for Indian Rupees (INR) and then immediately enters into an opposite agreement with banks agreeing to sell dollars at a later date.
Detailed explanation-4: -The RBI controls Inflation and Deflation by employing a variety of monetary policy tools such as Repo Rate, Reverse Repo Rate, Bank Rate, Open Market Operations, Statutory Liquidity Ratio (SLR), Cash Reserve Ratio (CRR), Liquidity Adjustment Facility (LAF), Market Stabilisation Scheme.
Detailed explanation-5: -Liquidity in the banking system refers to readily available cash that banks need to meet short-term business and financial needs.