Now Reading: RBI mops up Rs 80,170 crore via VRRR, announces bigger 3-day auction
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RBI mops up Rs 80,170 crore via VRRR, announces bigger 3-day auction
The Reserve Bank of India on August 14 announced a three-day Variable Rate Reverse Repo (VRRR) auction for Rs 1.5 lakh crore, citing evolving liquidity conditions. The auction will be held from…
The Story in Brief
The Reserve Bank of India on August 14 announced a three-day Variable Rate Reverse Repo (VRRR) auction for Rs 1.5 lakh crore, citing evolving liquidity conditions. The auction will be held from 9:30 am to 10:00 am, with reversal on August 17.
A day earlier, the RBI conducted a one-day VRRR for a notified amount of Rs 1 lakh crore, receiving bids worth Rs 80,170 crore at a cut-off rate of 5.24 per cent. The central bank accepted all offers received.
The Indian Opinion
The undersubscription of the one-day VRRR may lead some to claim banks are resisting lower rates, but the RBI's swift move to a larger, longer auction shows it is managing surplus liquidity without forcing rates. The real test will be the cut-off rate of the three-day auction on August 17.
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.
