BUDGET GLOSSARY II
TREASURY
BILL (T-BILLS):-These are bonds (debt securities) with
maturity of less than a year. These are issued to meet short-term
mismatches in receipts and expenditure. Bonds of longer maturity are
called dated securities.
MARKET STABILISATION SCHEME (MSS):- The scheme was launched in April 2004 to strengthen Reserve Bank of India's (RBI) ability to conduct exchange rate and monetary management. The RBI mops up excess liquidity, created, for instance when the central bank buys up huge quantities of dollar inflows to prevent undesirably fast appreciation of the rupee, by selling its stock of government securities to banks. When the RBI began to run short of of government securities that had been issued to meet the government's borrowing requirement, the MSS was launched. These securities are issued not to meet the government's expenditure but to provide the RBI with a stock of securities with which to intervene in the market for managing liquidity.
