The Reserve Bank of India (RBI) conducted a Daily Variable Rate Repo (VRR) auction today with a tenor of one day. The notified amount for the auction was ₹1,50,000 crore, and the total amount of bids received amounted to ₹1,24,009 crore. In response to the demand, the RBI allotted the entire amount of ₹1,24,009 crore.
The cut-off rate for the auction was set at 6.26%, and the weighted average rate also came in at 6.26%, meaning all the bids were allotted at the same rate. The percentage of bids received at the cut-off rate stood at 100%, indicating that all bids were fully allotted at the 6.26% rate.
This VRR auction is a part of the RBI’s ongoing efforts to ensure adequate liquidity in the financial system, particularly in the short-term money market. Today’s result reflects a stable demand for funds at the given rate, underlining the central bank’s successful management of market liquidity.
The VRR auction plays a key role in stabilizing the banking sector’s liquidity and is a tool frequently used by the RBI to meet the short-term funding needs of financial institutions. The smooth execution of this auction further highlights the RBI’s role in maintaining financial market stability.
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