RBI absorbs ₹1.65 lakh crore in a day as banks park record cash at its deposit window
The Reserve Bank of India absorbed ₹1,65,213 crore of liquidity in a single day on Tuesday, as banks parked ₹1,72,235 crore at the central bank's standing deposit facility rather than lend it in the overnight market.
The scale of the absorption shows how much cash is sloshing around the system. Overnight money market volumes reached ₹7,17,097.85 crore, with the weighted average call rate at 5.75 per cent and the triparty repo rate at 5.62 per cent. The SDF pays 5.25 per cent, so banks are accepting a lower return to keep funds with the RBI.
Against that, the RBI injected ₹7,022 crore through its marginal standing facility and ₹1,50,007 crore remains outstanding from a four-day variable rate repo auction on Monday at 5.55 per cent. A 29-day reverse repo of ₹25,555 crore, auctioned on October 8 and maturing November 6, is still running at 5.49 per cent.
Net liquidity from outstanding operations stood at an injection of ₹1,34,793.87 crore, but including Tuesday's operations the system swung to a net absorption of ₹30,419.13 crore. Banks' cash balances with the RBI were ₹8,47,673.99 crore, against an average daily cash reserve requirement of ₹8,33,309 crore for the fortnight ending October 31.
Net durable liquidity was a surplus of ₹10,14,401 crore as of September 30, and the government held no surplus cash balance reckoned for auction on Tuesday. The RBI also reported ₹10,341.87 crore availed under the standing liquidity facility.
