RBI’s 29-day VRRR auction draws tepid bids
In short
The Reserve Bank of India held a 29-day reverse repo auction on Thursday and got Rs 79,655 crore in bids. It accepted all of them at 5.49%.
This matters because the response was weaker than the one-day auction, which got Rs 1,60,664 crore in bids. The report says banks still have a liquidity surplus, but the exact figure is not fully stated.
What the reporting says
The Reserve Bank of India held a 29-day variable rate reverse repo auction on Thursday and received Rs 79,655 crore in bids, which it fully accepted at 5.49%. The response was weaker than the one-day VRRR auction, which drew Rs 1,60,664 crore in bids, and the banking system was said to have a liquidity surplus of around Rs 4, though the unit is not stated in the summary. The immediate takeaway is softer demand for the longer-tenor operation despite ample surplus liquidity.
Why it matters
The RBI’s 29-day VRRR auction is the key event, with Rs 79,655 crore in bids fully accepted at 5.49%. The response was smaller than the one-day VRRR auction’s Rs 1,60,664 crore in bids, even though banking-system liquidity was still described as a surplus. Banks and money-market rates are the most affected, but the summary does not explain why demand was tepid.