Liquidity

Liquidity normalisation key before RBI embarks on interest rate hikes

With global central banks raising rates, RBI may need to drain excess banking liquidity and align overnight rates with the repo rate before embarking on a fresh tightening cycle

RBI absorbs ₹50,000 crore through bond sale amid liquidity surge

The central bank sold Rs 50,000 crore of government securities in the first of three OMO tranches planned for September to absorb surplus liquidity from the banking system.

RBI absorbs ₹2.4 trillion via VRRR auction amid surplus liquidity

The Reserve Bank of India (RBI) on Thursday absorbed Rs 2.40 lakh crore through variable rate reverse repo (VRRR) auctions from the banking sector amid huge surplus liquidity. The central bank received bids worth Rs 2,39,959 crore, which it accepted fully, at a cut-off and weighted average rate of 5.24 per cent. The RBI has been, since last month, doing various VRRR auctions in order to absorb excess surplus liquidity from the banking system and align the overnight money market rates to the repo rate. Currently, liquidity in the banking system is estimated to be in surplus of around Rs 7.38 lakh crore as on September 16. Apart from VRRR, last week, the central bank announced Open Market Operation (OMO) sales of government securities for a notified amount of Rs 1 lakh crore in three tranches. The first tranche of Rs 50,000 crore will be held on September 17, and Rs 25,000 crore each on September 21 and September 28, RBI said. The banking system has a huge surplus of liquidity due

RBI absorbs ₹2.9 trillion via two VRRR auctions amid surplus liquidity

The Reserve Bank of India (RBI) on Wednesday absorbed Rs 2.90 lakh crore through two variable rate reverse repo (VRRR) auctions from the banking system amid a huge surplus. In the first auction, the central bank received bids worth Rs 3,17,088 crore for a notified amount of Rs 2.50 lakh crore. However, it accepted only Rs 2,50,025 crore at a cut-off and weighted average rate of 5.24 per cent. The central bank received a tepid response in the second auction with bids worth Rs 40,302 crore for a notified amount of Rs 1 lakh crore, which it accepted fully. The RBI, since last month, has been conducting various VRRR auctions in order to absorb surplus liquidity from the banking system and align the overnight money market rates to the repo rate. Currently, liquidity in the banking system is estimated to be in surplus of around Rs 9.85 lakh crore as on September 15. Apart from VRRR, last week, the central bank announced Open Market Operation (OMO) sales of government securities for a ..

RBI may take until Q2FY28 to absorb ₹4 trn durable liquidity surplus

Economists expect the central bank to use OMO sales, sell-buy swaps and other liquidity-management tools to gradually absorb the durable surplus

Initial liquidity issues with CAS seen across global markets: Sebi chief

Says AI can help the regulator shift to 'proactive' monitoring from 'periodic' monitoring; Sebi is also set to propose changes to the closing auction framework

RBI plans to drain ₹5 trillion through 26-day liquidity mopup bid

Central bank will conduct a 26-day VRRR auction on Friday to absorb surplus banking-system liquidity; funds placed in the auction will be reversed on October 7

After the dollar deluge, costly choices

India must now choose among currency appreciation, inflation, bank losses, indirect public exposure and an expensive sterilisation programme

Banks show little appetite for Reserve Bank of India's 30-day VRRR bid

Bids worth ₹2.59 trn received against ₹7 trn notified

RBI withdraws over ₹6 trillion of bank liquidity after record spike

The Reserve Bank ​of India received offers worth ₹3.53 trillion at an overnight auction, right ‌after banks parked ₹2.59 trillion through a 30-day auction

RBI's 30-day VRRR auction raises odds of rate hike in October policy

Fx reserves swell to nearly $741 bn, driven by rush of swap dollars

RBI absorbs ₹6.02 trillion via VRRR auctions amid record liquidity surplus

The Reserve Bank of India (RBI) on Friday absorbed over Rs 6.02 lakh crore from the banking system through two variable rate reverse repo (VRRR) auctions as surplus liquidity remained at a record high. The central bank received and accepted bids worth Rs 5,41,975 crore in a three-day VRRR auction against the notified amount of Rs 7 lakh crore. The auction was conducted at a cut-off rate of 5.24 per cent. In another three-day VRRR auction, against a notified amount of Rs 1.5 lakh crore, banks parked Rs 60,419 crore with the RBI, also at 5.24 per cent. Together, the two operations helped the RBI absorb Rs 6,02,394 crore of surplus liquidity. The RBI has stepped up liquidity absorption operations as the banking system has been flooded with funds following large inflows through the special FCNR(B) deposit scheme. Currently, liquidity in the banking system is estimated to be in surplus of around Rs 10.32 lakh crore as on September 3, according to the RBI's data. The RBI's special fore

Strong FCNR(B) flows drive excess liquidity to 4-year high of ₹6.65 trn

Muted response to fresh ₹10 trn VRRR auctions; rupee appreciates to two-month high

₹10 trillion VRRR draws tepid response amid ₹5 trillion liquidity flush

Banks parked Rs 3.84 trillion against the Rs 10 trillion notified in Monday's VRRR auctions, while the benchmark 10-year government bond yield rose to 6.95 per cent

Bond traders expect RBI to drain surplus liquidity as rate hikes loom

India's banking-system liquidity surplus has averaged more than 3.4 trillion rupees ($36 billion) so far in August and is expected to expand further

RBI may tighten liquidity via iCRR before resorting to repo rate hike

The RBI may use an incremental CRR to absorb rising surplus liquidity before raising the repo rate, as core liquidity could approach ₹10 trillion in coming weeks

RBI absorbs ₹1.41 trn surplus liquidity via VRRR, announces fresh auction

The central bank absorbed ₹1.41 trillion through seven-day and overnight VRRR auctions at 5.24 per cent, and announced a ₹1.75 trillion two-day auction for Tuesday

Strong demand at RBI liquidity mop-up auctions; another ₹1.5 trn on Friday

RBI receives cumulative bids of Rs 1.91 trillion against the notified Rs 1.5 trillion as banks seek higher returns amid surplus liquidity and softer overnight rates

RBI's VRRR auctions draw ₹1.91 trn bids; ₹1.5 trn auction on Friday

Strong bank demand at RBI's VRRR auctions highlights surplus liquidity in the system, as the central bank seeks to keep overnight rates aligned with its 5.25% repo rate

RBI to absorb ₹1.5 trillion via VRRR as liquidity tops ₹3 trillion

The Reserve Bank will conduct a seven-day variable rate reverse repo auction after surplus liquidity in the banking system crossed Rs 3 trillion, keeping overnight rates close to the SDF