RBI's Daily VRR Auction Sees ₹1.94 Trillion Bids Amid Liquidity Crunch

The Reserve Bank of India (RBI) received bids worth ₹1.94 trillion at its daily variable rate repo (VRR) auction on Wednesday, falling short of the ₹2.5 trillion notified amount. The weighted average rate and cut-off rate settled at 6.26%, reflecting persistent liquidity stress as the banking system faces an eight-week deficit. This follows the RBI’s recent doubling of OMO purchases (₹40,000 crore) and a 25 bps repo rate cut to 6.25% to ease conditions. Analysts note sustained demand for short-term funds amid GST outflows and forex interventions.

 

Sources: Economic Times, Reuters, Hindustan Times