It is a monetary policy intervention by the RBI to withdraw excess liquidity by selling government securities in the economy” is known as

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Q. “It is a monetary policy intervention by the RBI to withdraw excess liquidity by selling government securities in the economy” is known as?

[A] Repo rate

[B] Cash Reserve Ratio

[C] Reverse Repo rate

[D] Market Stabilization Scheme

Answer: D

Notes:

Explanation: Market Stabilization scheme (MSS) is a monetary policy intervention by the RBI to withdraw excess liquidity (or money supply) by selling government securities in the economy.

The MSS was introduced in April 2004. Main thing about MSS is that it is used to withdraw excess liquidity or money from the system by selling government bonds.

Source: TMH Ramesh Singh

Q. “It is a monetary policy intervention by the RBI to withdraw excess liquidity by selling government securities in the economy” is known as?

Post-Mains Strategy Session by Mr. Ayush Sinha | ForumIAS