Q. Secured Overnight Rupee Rate (SORR) refers to:

[A] A new exchange rate mechanism to determine rupee value against major currencies.

[B] An overnight lending rate benchmark based on secured money market transactions.

[C] A special rate offered by RBI for overnight parking of excess funds by commercial banks.

[D] A rate used for calculating interest on government securities in the primary market.

Answer: B
Notes:

Explanation – The Secured Overnight Rupee Rate (SORR) is a new benchmark introduced by the RBI, based on secured money market transactions, such as basket repo and triparty repo (TREP). It is designed to replace or complement the Mumbai Interbank Outright Rate (MIBOR) and enhance transparency in the interest rate derivatives market by relying on actual trade data rather than polled rates. This aligns with global best practices, such as the Secured Overnight Financing Rate (SOFR).

Source: DD News

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