Economics · Monetary Policy
What is the primary objective of the 'Market Stabilization Scheme (MSS)' introduced by the RBI, and how does it differ from traditional Open Market Operations (OMO)?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1MSS involves the purchase of gold to stabilize the international value of the Indian Rupee.
- 2MSS securities are part of the government's regular borrowing program for meeting the fiscal deficit.
- 3MSS is specifically used to mop up excess liquidity created by large foreign exchange inflows.✓
- 4MSS is used to provide long-term liquidity to stressed sectors like MSME.
Correct answer
MSS is specifically used to mop up excess liquidity created by large foreign exchange inflows.
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