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Showing posts from August, 2010

Growth of Indian Money Market

While the need for long term financing is met by the capital or financial markets , money market is a mechanism which deals with lending and borrowing of short term funds. Post reforms age in India has witnessed marvelous increase of the Indian money markets . Banks and other financial institutions have been able to meet the high opportunity of short term financial support of important sectors like the industry, services and agriculture. It performs under the regulation and control of the Reserve Bank of India (RBI). The Indian money markets have also exhibit the required maturity and flexibility over the past two decades. Decision of the government to permit the private sector banks to operate has provided much needed healthy competition in the money markets resulting in fair amount of improvement in their performance. Money markets denote inter-bank market where the banks borrow and lend between themselves to meet the short term credit and deposit needs of the economy. Short