Rupee Wobbles, RBI Flexes: What June 24 Liquidity Numbers Reveal

Image Source: The Economic Times

India's financial markets opened on Tuesday with a mix of cautious optimism and liquidity reset, as key indicators reported subtle shifts in investor sentiment and central bank activity.

Bond Market Update

Benchmark 10-year government bond yield (IN067934G=CC) increased by 2 basis points to 6.3637%, compared to the previous close of 6.3384%.
The appreciation is on account of soft pressure from global leads and expectations of liquidity absorption efforts by the Reserve Bank of India (RBI).

Snapshot: Currency Market

The Indian Rupee began slightly weaker at ₹86.01 against the US dollar, 0.04% lower than the previous close of ₹85.9750.
The price movement is in the backdrop of a small dollar rally and cautious foreign fund inflows.

RBI Money Market Operations (June 24, 2025)

Banks' cash balances with the RBI stood at ₹9.43 trillion, reflecting a continued surplus in the system.
The government's surplus cash holding with the RBI was nil, implying active usage or redirection of funds.
The RBI recorded refinance operations of ₹70.32 billion, a routine liquidity support measure.

Liquidity Outlook

The RBI will hold a ₹1 trillion Variable Rate Reverse Repo (VRRR) auction on June 27 to absorb surplus liquidity, which stood at ₹2.44 trillion as of June 235.
This suggests the central bank's inclination to bring near-term rates closer to the repo rate and exercise system liquidity management more aggressively.

Sources:Trading Economics, Exchange Rates, RBI Press Release, Moneycontrol, Financial Express