Banks park Rs 2,760 cr with central bank as RBI hints at open market operations
RBI had decided on September 8 to discontinue the I-CRR by October 7, in a phased manner
"The estimates are that around Rs 90,000 crore to Rs 1 trillion will go out as goods and services tax (GST) outflow," a dealer at a primary dealership said
Although sales from the HTM category are still permitted, internal reclassifications can now only occur under exceptional circumstances
There are signs of improvement in the liquidity scenario as banks parked Rs 25, 833 crore with the RBI on Thursday
The withdrawal of the Rs 2,000 note will likely result in a spurt in liquidity. How are the subsequent changes likely to impact you? Read more to find out
The process to withdraw the Rs 2,000 note started from May 23
India's central bank may buy as much as 1.5 trillion rupees ($18 billion) of government bonds to replenish banking liquidity that's expected to tighten later in the year, according to a top banker.
Government monitoring developments in the West closely, says one official
The data also showed $11.9 billion in borrowing from the Fed's new emergency backstop known as the Bank Term Funding Program, which was launched Sunday
Consider laddering to ensure liquidity and to avoid reinvestment risk
They suggested that the central bank could look at a reasonable cap to the FLDG models, given RBI's concerns of around build-up of systemic risk and 100% risk transfer rather than banning it outright
The fall in the liquidity surplus is owing to multiple factors, including the RBI's interventions in the forex market and a sharp pick-up in bank credit growth, which is currently at nine-year highs
Liquidity in India's banking system is likely to remain in deficit in the second half of this financial year as credit growth picks up and the circulation of currency notes rises, analysts said
Days of easy money over as credit growth rises
India's banking system liquidity has slipped into deficit for the first time in nearly 40 months, according to the Reserve Bank of India
GST outflows have also pushed up interbank cost of funds
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Net daily liquidity absorbed from banks on July 9 was Rs 4.6 trillion, data released on Monday showed
RBI meant strict business, with a focus on alleviating financing constraints for economic stakeholders at the grass root level bearing a disproportionate burden of the ravaging Covid second wave