Mumbai, Aug. 6 -- Reserve Bank had constituted an Internal Working Group (IWG) to review the extant Liquidity Management Framework which has been in operation since February 2020. The Group has submitted its report and the same is being placed on the RBI website today.

Here are the recommendations offered by the group:

The Group recommends that the overnight Weighted Average Call Rate may continue as the operating target of monetary policy. The Reserve Bank may, however, continue to keep track of rates in other overnight money market segments to ensure orderly evolution of money market rates and smoothen transmission. The Group recommends continuation of the existing corridor system with policy repo rate at the middle of the corridor. ...