Liquidity

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

RBI sees liquidity surplus peaking in September before normal absorption

Governor Sanjay Malhotra says surplus liquidity is likely to peak around September before being absorbed through higher currency circulation, reserve requirements and maturing forex forwards

RBI allows banks to link bulk deposit rates to liquidity profile

Banks can now price bulk deposits based on liquidity characteristics under the LCR framework, while continuing to follow uniform interest rate norms

Immediate annuities: Multiple options available, weigh trade-offs carefully

Annuitise only essential expenses, retain liquidity and compare payout options and rates before purchase

Liquidity stress in small-cap funds eases to lowest level since March 2024

Improved trading volumes and a recovery in small-cap stocks have reduced liquidity stress in small-cap mutual fund schemes to the lowest level since March 2024

RBI conducts two VRR auctions as liquidity surplus dips below ₹1 trillion

The central bank held two variable rate repo auctions after banking system liquidity surplus dropped below Rs 1 trillion, while the 10-year bond yield rose 3 basis points

Sebi may ease short selling by doubling lendable stocks for investors

Stock scam ‌scandals led India to develop strict requirements for its cash equities market, with rules tightened in the early 2000s and then again in the period 2017 to 2020

RBI injects ₹1.41 trn liquidity in banking system via 7-day VRR auction

The Reserve Bank of India (RBI) on Tuesday injected Rs 1,41,171 crore transient liquidity into the banking system through a seven-day variable rate repo (VRR) auction. The funds were infused at a cut-off and weighted average rate of 5.26 per cent, according to the RBI's release. This was done after the liquidity in the banking system turned in to deficit of Rs 19,971.89 crore as on June 22, from a surplus of Rs 30,685.11 crore as on June 21. Experts attributed the tightening of liquidity to the outflows on account of goods and services tax (GST) payments from the banking system. The liquidity entering the deficit territory has put pressure on the overnight money market rates, with weighted average call money rate trading at 5.43 per cent, which is 0.18 per cent above the RBI's repo rate. Similarly, the tri-party repo (treps) were trading 0.05-0.07 per cent over the repo rate. In the last few days, the central bank has been infusing transient liquidity into the banking system as i

RBI to conduct 3-day VRR auction on Friday, aims to infuse ₹1 trillion

The central bank will conduct a three-day variable rate repo auction to address evolving liquidity conditions after surplus liquidity moderated due to advance tax outflows

RBI liquidity measures drive steep decline in CD rates across tenors

Banks have begun pricing in stronger liquidity conditions after RBI measures to attract foreign inflows, reducing funding pressures and lowering short-term borrowing costs

RBI injects ₹72,300 crore as advance tax outflows squeeze liquidity

Surplus liquidity fell to ₹23,881.21 crore on June 16 from ₹1.51 trillion a day earlier; overnight rates trade above repo rate

FCNR (B) inflows to help replace costly bulk deposits, aid bank margins

Expected inflows could help narrow the credit-deposit gap

RBI's bulk deposit proposal paves way for risk-based pricing by banks

Draft framework would allow lenders to align deposit rates with liquidity costs under LCR norms, improving pricing efficiency and balance-sheet management

RBI to conduct overnight VRR auction to infuse ₹1.25 trillion liquidity

The Reserve Bank of India will conduct an overnight VRR auction on Thursday to manage evolving liquidity conditions and keep overnight rates aligned with the policy repo rate

RBI to conduct five-day VRR auction on Wednesday for ₹1.5 trillion

The Reserve Bank of India will conduct a five-day variable rate repo auction to manage evolving liquidity conditions in the banking system