Operation Twist Explained - RBI | Bond Yield | UPSC Economy | Adil Baig | KingMakers IAS Academy
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- Опубліковано 13 жов 2024
- On December 19, the Reserve Bank of India decided to conduct its version of ‘Operation Twist’ through simultaneous purchase and sale of government securities under Open Market Operations (OMOs) for Rs 10,000 crore each on December 23.
Operation Twist is the name given to a US Federal Reserve monetary policy operation, which involves the purchase and sale of government securities to boost the economy by bringing down long-term interest rates.
In this video, you will get clarity on the following topics
Open Market Operations
Yield Curve, bond yield
Reasons for Operation twist
Outcomes of Operation twist
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Sir, how does the LTGS Yield Rate determines the Bank Lending Rate?
Twist danceeeee paathachuu😂👍
thank u sir now only understood
Sir Yield Rate athigam aachuna maximum athula tha invest pana paapanga banks. so Antha investment aa namaku tharanum same profit varathukaga lending ratesa athigapaduthuvangala?
Superb sir very clear cut explanation where I never seen 😊
Keep watching..!
@@KingmakersIASAcademy @39.41 sir If the YR of the bank is high then why the lending rate should be high when bank has money it should lend at low rate to have money supply in the economy right ? or else the bank seeking profit out of it as it is a long term effect
Sir, your explanation was quite simple and easy remembering method. I've a doubt. Do Short-term G.Sec. coupon rate will always be lower than Long-term G.Sec. (CR) or it depends on market situations..
Depends on the market situations.
ultimate sir
sir, government borrows money and gives interest at coupon rate in primary market, and due to the demand and supply, yield rate changes in secondary market, but again if a new bond is released by the government, is the coupon rate in the new primary market equal to the previous yield rate in the secondary market?, my question is also how borrowing becomes cheap for the government ?, can u explain it sir !!!
Sir
When govt sells bonds in larger amount Bp will fall and By increases. Ok
How a rise in By leads to increase in cost of borrowing (rate of interest) for govt and corporates
Please explain
Similarly borrowing bonds results in rise in Bp and fall in By
How a fall in BY leads to a fall in interest (cost of borrowing.
Sir how operation twist leads to reduce in lending rate im not clear with tht part alone
When A sells g-sec in secondary market before maturity date of 1yr to B, does the cycle of 1yr start fresh for B or from the date which A gave up?
Cuz govt know it's sold g-sec to A for 1 yr and B just intercepted in the middle
And when will the 15finance commission session dated for sir?
Today at 6:30PM
It wont start fresh.. Maturity date is constant!
Thanks sir
Sir how yield rate if reduced reduces bank lrnding rate
Thank you Sir
Sir
Through omo govt sells securities.
since it is safe there will be more demand.for them. So prices of security will rise.when Bp rise yield will fall.this is my understanding. But you said since government sells securities supply rise.as a result BP fall amd yield rise.
Which is confusing
When there is huge demand for securities, then its price will rise... BY will fall. Yes. Demand is cause and fall in bond yield is effect.
When RBI sells a lot of Government securities more than what market demands. Then supply of Government securities increases the Demand and hence BP falls and BY rises.
Super sir
sir thula st banks vangala na if its corona time why i invest nu ninachangla
I couldn't understand the question. Can you Elaborate?
Operation twist ppl buy stgs bond from rbi preferable
So bank lending rate koraikanu ilana ppl opt for stgs solringalaa
Im confused tht area how operation twist leads to decrease lending rates
You have understood the concept very well and asked the right doubt.
If yield rate of long term Government Security decreases, it ll be reflected in lending rates of banks.
Now you are asking how?
Bank decides Lending rates based on innumerable variables and market conditions and Yield rate of LTGS is one of the important variables which impacts Lending rates of Bank.
MCLR formula used by banks contains many variables and LTGS Yield is one among it.
@@KingmakersIASAcademy like bank invest in ltgs they get more more miney in hands now
So more money the reduce the interest rate ?
This can be applied ryt sir
@@KingmakersIASAcademy sir how gsec interest r reduced when easing monetary transmission
Confused again
Plz make the videos in English
Thalaiava💢looking sexy🔥🔥
Super sir
Thank you Sir