With reference to the Marginal Standing Facility (MSF), consider the following statements:

1. Its aim is to reduce volatility in the overnight lending rates in the interbank market.

2. Borrowing rate under this facility is always higher than the repo rate.

3. Under MSF, banks can borrow funds by pledging government securities within the limits of the statutory liquidity ratio.

Which of the statements given above is/are correct?

1
1 and 2 only
2
3 only
3
1 and 3 only
4
1, 2 and 3

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