The Sensex declined up to 0.51 per cent to an intraday low of 84,042.75, while the Nifty50 slipped 0.44 per cent to 25,764.90.
To start with, growth and inflation forecasts will be in focus as the RBI will also publish their Monetary Policy Report (MPR) along with the MPC statement
Assocham president Sanjay Nayar emphasised that the RBI has already injected liquidity into the market through various measures
Banks bid 4.5x in Thursday's auction
NSE Clearing Ltd, the clearing house of the National Stock Exchange (NSE), has failed to meet the capital markets regulator Sebi's mandated liquidity requirements, citing the non-payment of dues by rival BSE as the primary reason for the shortfall. In its December 2024 quarterly results, NSE Clearing, the exchange's unit responsible for clearing and settling its trades, reported a shortfall of Rs 176.65 crore in its minimum liquid assets. The company informed Sebi in a letter dated January 9 that this deficit was primarily due to the non-receipt of Rs 312.37 crore in dues from BSE. An NSE Clearing spokesperson said its auditors flagged the outstanding payment issue in their third-quarter financial review. The outstanding amount pertains to "interoperability arrangements", the official said. "The company is yet to receive outstanding dues of over Rs 300 crore from BSE Ltd. NSE Clearing is communicating with BSE on this matter," the spokesperson added. The Securities and Exchange B
The cash injection has also led to a decline in the weighted average call rate, which represents banks' overnight borrowing costs
This reduction in the CRR released primary liquidity of approximately Rs 1.16 trillion into the banking system
"Banks are neither sanctioning new lines (of credit) nor disbursing from already sanctioned limits," the official at the company, who did not want to be named, said
Liquidity may not improve immediately as tax outflows of around Rs 1.25 trn are scheduled in March, says one expert
Investors have favoured longer-tenure government bonds, or g-secs, with insurance companies and pension funds leading the charge by stocking up on those with maturities of 30 years and more
Banks parked Rs 18,750 crore at the auction against a notified amount of Rs 50,000 crore at a weighted average rate of 6.49 per cent
The liquidity drought may be deliberate. Unlike Beijing, New Delhi has every reason to be sanguine about growth
In the preceding VRR auctions, the central bank received a significant response, with banks submitting bids ranging between 2.5 to 3.2 times the bidding amounts due to tight liquidity conditions
The deficit liquidity in the banking system widened to Rs 2.7 trillion on Thursday, according to data by the central bank
"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
Banking system liquidity went in surplus mode on Thursday after being in deficit for three days
RBI's August monetary policy review asked banks to maintain an incremental cash reserve ratio of 10%
Corporates have traditionally preferred raising funds via private placements due to its ease, shorter execution time, and lower costs overall
Credit demand at decadal highs and liquidity remains significantly downsized, says research
Persistently weak liquidity, high refinancing needs triggers rating action