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    Question

    The Reserve Bank ofIndia (RBI) has introduced the SORRas

    a new benchmark for overnight rupee transactions, aiming to improve transparency and better reflect market dynamics. What does the "S" in SORR stand for?
    A Secured Correct Answer Incorrect Answer
    B System Correct Answer Incorrect Answer
    C Standard Correct Answer Incorrect Answer
    D Special Correct Answer Incorrect Answer
    E Service Correct Answer Incorrect Answer

    Solution

    • What is SORR? o SORR is the Secured Overnight Rupee Rate, a benchmark interest rate introduced by the Reserve Bank of India (RBI). o It is based on secured money markettransactions, including repo and tri-party repo (TREP) transactions. • Purpose of SORR: o The SORR aims to improve transparency in the market. o It is designed to better reflect market dynamics for overnight rupee transactions in the Indian financial system. • Components of SORR: o The rate is calculated using secured transactions, which ensures that it reflects the market's true cost of borrowing, with collateral in place, making it less prone to market fluctuations.

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