Liquidity

Banks park ₹79,655 crore at Reserve Bank of India's 29-day VRRR auction

Banks bid ₹79,655 crore in the RBI's 29-day VRRR auction against ₹2 trn offered, while the 10-year benchmark yield rose to 7.29% amid expectations of OMO sales

Surplus liquidity may not persist beyond FY27: RBI Governor Malhotra

Sanjay Malhotra says currency leakage and OMOs will absorb funds; calls CRR hike among least preferred tools for RBI

RBI may continue liquidity absorption as it begins rate-hiking cycle

Core liquidity surplus remains around ₹10 trillion, keeping the focus on RBI's liquidity operations as markets expect a 25-basis-point repo rate increase this week

RBI absorbs ₹2.10 trillion via VRRR auctions amid surplus liquidity

The Reserve Bank of India (RBI) on Monday absorbed Rs 2,10,192 crore liquidity from the banking system through two overnight Variable Rate Reverse Repo (VRRR) auctions, amid huge surplus liquidity in the system. During the first auction, the central bank received bids worth Rs 2,10,688 crore for a notified amount of Rs 2 lakh crore. It accepted Rs 2,00,050 crore at a weighted average rate of 5.24 per cent. However, the response from banks in the second auction was tepid, with just Rs 10,142 crore in bids for a notified amount of Rs 50,000 crore, which the central bank accepted fully. Over the last two months, the central bank has undertaken multiple VRRR auctions 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 5.16 lakh crore as on October 4, as per RBI data. The banking system has been flush with liquidity due to heavy ...

India's bond yield curve poised to flatten as RBI drains surplus cash

The 5-10 year yield gap is expected to narrow as the RBI drains surplus cash, pressuring shorter maturities

Matter of liquidity: How the RBI manages cash in the banking system

Why the central bank relies on a mix of short- and long-term tools to keep money in check

RBI OMOs reduce liquidity to ₹6 trn; GST outflows help absorb surplus

The increase in currency in circulation and the rise in reserve requirements as the deposit base expands could absorb a part of the surplus over the coming months

RBI sells ₹25K cr G-Secs in second OMO tranche to drain surplus liquidity

The Reserve Bank of India (RBI) on Monday accepted bids worth Rs 25,000 crore in the second tranche of its open market operation (OMO) sale of government securities, as it stepped up efforts to absorb surplus liquidity from the banking system. The RBI accepted Rs 11,512 crore of the 6.10 per cent GS 2031, Rs 8,758 crore of the 7.95 per cent GS 2032, Rs 2,300 crore of the 6.75 per cent GS 2029, Rs 2,250 crore of the 7.17 per cent GS 2030, and Rs 180 crore of the 7.17 per cent GS 2028, according to the release. However, the central bank did not accept any bids for the 8.28 per cent GS 2027, the release said. The OMO sale comes amid a large liquidity surplus in the banking system. Liquidity surplus was estimated around Rs 6.05 lakh crore as of September 20, according to the RBI data. Under an OMO sale, banks and other investors pay the RBI for the government securities, thereby draining rupee liquidity from the banking system. The central bank had announced OMO sales totalling Rs 1 la

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