Now Reading: RBI absorbs Rs 95,810 crore in 7-day VRRR auction
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RBI absorbs Rs 95,810 crore in 7-day VRRR auction
The Reserve Bank of India mopped up Rs 95,810 crore from the banking system through a seven-day Variable Rate Reverse Repo (VRRR) auction held on Monday, August 10, 2026. The notified amount…
The Story in Brief
The Reserve Bank of India mopped up Rs 95,810 crore from the banking system through a seven-day Variable Rate Reverse Repo (VRRR) auction held on Monday, August 10, 2026. The notified amount was Rs 2,00,000 crore. The central bank accepted all bids received at a cut-off rate of 5.24 per cent.
The auction was conducted under the Liquidity Adjustment Facility after a review of current liquidity conditions. The amount accepted was less than half of the notified amount, indicating that banks chose to park only a part of their surplus funds with the RBI at the offered rate. The proceeds will be reversed on August 17.
The Indian Opinion
The tepid response to the VRRR auction, just 48 per cent of the notified amount, suggests banks see little incentive to lock in funds at 5.24 per cent for a week, perhaps expecting rates to firm up or alternative avenues. Some analysts may spin this as a sign of liquidity tightening, but the real test will be the next VRRR auction: if demand rises, the RBI's signal is working; if not, the rate may need adjustment.
Sources (2): rbi.org.in, rbi.org.in (2)
This story was synthesised by AI from the 2 sources linked above.
Updated: this story now draws on 2 sources.
