RBI absorbs ₹2.10 lakh crore in two overnight VRRR auctions
In short
The RBI took in ₹2,10,192 crore from banks in two overnight VRRR auctions on Monday. In the first auction it accepted ₹2,00,050 crore, and in the second it accepted ₹10,142 crore.
This matters because the RBI is trying to soak up extra cash in the banking system and keep short-term rates near the repo rate. The reporting does not say how long the surplus will last.
What the reporting says
The RBI absorbed ₹2,10,192 crore from the banking system through two overnight Variable Rate Reverse Repo auctions on Monday. The central bank accepted bids of ₹2,00,050 crore in the first auction and the full ₹10,142 crore offered in the second, after saying the system had huge surplus liquidity. The move was meant to absorb excess cash and align overnight money market rates to the repo rate, but the longer-term liquidity path is not stated.
Why it matters
The Reserve Bank of India carried out two overnight VRRR auctions and absorbed ₹2,10,192 crore from the banking system on Monday. Reported bids were ₹2,10,688 crore for the first auction and ₹10,142 crore for the second, against notified amounts of ₹2 lakh crore and ₹50,000 crore. The action targets surplus liquidity and overnight rate alignment, but the reporting does not say how long the excess liquidity will persist.