On February 2, 2026, the Reserve Bank of India (RBI) reported that banks’ average daily cash reserve requirement stood at ₹7.52 trillion for the two weeks ending February 15. Cash balances rose to ₹8.58 trillion on February 1, while borrowings under the Marginal Standing Facility (MSF) eased compared to January 31.
The Reserve Bank of India (RBI) has released its latest liquidity update, highlighting the evolving cash positions of Indian banks. For the two weeks ending February 15, 2026, the average daily cash reserve requirement (CRR) was pegged at ₹7.52 trillion, underscoring the central bank’s continued emphasis on maintaining adequate liquidity buffers in the financial system.
Key Highlights:
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Cash balances: On February 1, 2026, banks’ cash balances stood at ₹8.58 trillion, marking an increase from ₹7.62 trillion recorded on January 31.
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MSF borrowings: Borrowings under the Marginal Standing Facility (MSF), a window for banks to access emergency funds declined to ₹6.14 billion on February 1, compared to ₹8.48 billion on January 31, reflecting improved liquidity conditions.
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Liquidity management: The rise in cash balances indicates stronger reserve positions, while the reduced reliance on MSF suggests banks are better equipped to meet short-term funding needs.
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Systemic impact: Analysts note that the RBI’s liquidity framework continues to balance inflation control with growth support, ensuring banks have sufficient capital to lend while avoiding excess volatility in money markets.
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Policy relevance: These figures come at a crucial time as markets digest the Union Budget 2026, with expectations of higher government spending on infrastructure and green energy likely to influence liquidity demand in coming months.
Outlook:
The RBI’s latest update signals a stable liquidity environment, with banks maintaining healthy reserves and reduced dependence on emergency borrowing. Market experts believe this trend will support credit growth while giving the central bank flexibility to manage inflationary pressures and global financial uncertainties.
Sources: Reuters, Economic Times Markets, Mint Business, Business Standard