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RBI Rs 1 Lakh Crore VRR Auction to Ease Banking Liquidity

By SivamRBI Rs 1 Lakh Crore VRR Auction to Ease Banking Liquidity

RBI announces a Rs 1 lakh crore VRR auction on June 19 to manage banking system liquidity and stabilize overnight money market rates in India.

RBI Announces Rs 1 Lakh Crore VRR Auction

The Reserve Bank of India (RBI) will conduct a three-day variable rate repo (VRR) auction worth Rs 1 lakh crore on June 19. This move is designed to ease liquidity pressures within the banking system.

The auction also aims to keep overnight money market rates stable, responding to evolving market conditions.

Key Auction Details

  • The auction is scheduled for June 19, running from 9:30 am to 10:00 am.
  • Funds from this VRR auction are slated for reversal on June 22.
  • This measure follows a review of current liquidity conditions by the central bank.

Liquidity Management Focus

The RBI’s decision comes as banking system liquidity is currently estimated to be in a surplus. This intervention is a proactive step to manage this surplus effectively.

It underscores the central bank’s commitment to maintaining financial stability and smooth functioning of money markets in India.

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