RBI buys $5.5B bonds in first auction since May to boost liquidity

• RBI bought $5.5 billion (Rs 50,000 crore) of bonds in its first auction since May.
• The purchase aims to boost liquidity in the banking system.
• This is part of RBI's plan to inject Rs 1 lakh crore via bond purchases and $5 billion via FX swaps this month.
• Bond yields fell after the auction results were published.
• The central bank's efforts to shield the rupee have drained cash, necessitating liquidity injections.

Why It Matters: RBI's bond purchase affects market liquidity and interest rates.