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RBI Suggests Major Revamp in Liquidity Management to Boost Monetary Policy

reexamining the width of interest rate corridor, the central bank aims to regain its control over short-term rates. The greater participation in inter-bank market is also seen to be essential in the creation of a strong yield curve and enhancement of the depth of financial markets in India.

The RBI is expected to conduct rigorous empirical research on these propositions before making adjustments, making the new framework to be effective and resilient.

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