RBI Signals Tight Liquidity: Banks' Balances Dip to ₹7.16 Tn on Dec 4 Amid MSF Taps

Liquidity Snapshot

The Reserve Bank of India disclosed Dec 4 money market operations, showing banks' cash reserves at ₹7.16 trillion against a ₹7.40 trillion average CRR requirement for the Dec 12 fortnight—indicating a slight shortfall. Government surplus cash with RBI stood at zero, halting auctions and signaling fiscal spending pressures. Overnight rates hovered around 5.2-5.3%, with triparty repo dominating volumes.​

Operations Breakdown

RBI injected ₹82.78 billion via refinance facilities, supporting sectors amid seasonal demands. Banks tapped Marginal Standing Facility (MSF) for ₹8.10 billion overnight liquidity at 6.75%, a corridor tool for end-day needs. Net position shows absorption from prior ops, with durable surplus at ₹3.61 trillion earlier. This aligns with RBI's steady repo rate stance amid inflation control.​

Key Highlights

Banks' Cash Balances: ₹7.16 Tn (vs. ₹7.40 Tn CRR avg).​

Govt Surplus: Nil for Dec 4 auction.​

Refinance: ₹82.78 Bn disbursed.​

MSF Borrowing: ₹8.10 Bn by banks.​

Sources: The Week (PTI), RBI Money Market Operations