JAIIB · IEIFS

Financial Markets & Money Market

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Indian Economy and Indian Financial System — JAIIB.

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What is the primary regulatory authority overseeing the money market in India?

The Reserve Bank of India (RBI) regulates the money market in India through instruments like the Liquidity Adjustment Facility (LAF) and open market operations.

What is the difference between organized and unorganized segments of the Indian financial market?

Organized markets are regulated; unorganized markets lack formal oversight.

What is the maturity profile that distinguishes money market instruments from capital market instruments?

Money market instruments have a maturity of up to one year (short-term), while capital market instruments have a maturity of more than one year.

What is the tenure of Treasury Bills issued in India?

91 days, 182 days, and 364 days tenures are available.

What is a Treasury Bill and who issues it in India?

Treasury Bills (T-Bills) are short-term government securities issued by the Government of India through the RBI, available in 91-day, 182-day, and 364-day maturities.

What is a 'ready forward' contract in the money market?

A ready forward contract is a repo agreement to repurchase securities at a fixed price.

What is a Certificate of Deposit (CD) and who can issue it?

A Certificate of Deposit is a negotiable money market instrument issued by scheduled commercial banks and select all-India financial institutions to raise short-term funds at market-related rates.

What is meant by 'hot money' in the context of financial markets?

Hot money refers to short-term speculative capital flows across borders seeking higher returns.

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