RBI 29-day reverse repo draws Rs 79,655 crore
In short
The Reserve Bank of India held a 29-day variable rate reverse repo auction after its rate hike. Banks put in Rs 79,655 crore, far below the Rs 2 lakh crore target. Early withdrawal was allowed.
This matters because surplus liquidity was still Rs 4.24 lakh crore. It is not clear if banks stayed away because of the daily VRRR options or for other reasons.
What the reporting says
The Reserve Bank of India ran a 29-day variable rate reverse repo auction after its rate hike, and banks parked Rs 79,655 crore against a target of Rs 2 lakh crore. The auction allowed early withdrawal, but participation stayed weak because daily VRRR options were also available. The reported surplus liquidity remained Rs 4.24 lakh crore, leaving monetary transmission challenges unresolved.
Why it matters
The Reserve Bank of India conducted a 29-day variable rate reverse repo auction, but banks placed only Rs 79,655 crore versus the Rs 2 lakh crore target. The auction allowed early fund withdrawal, yet participation was tepid, with daily VRRR options cited as a likely alternative. The reported Rs 4.24 lakh crore surplus liquidity shows the system still has excess cash, which may affect monetary transmission.