RBI to conduct 5-day Variable Rate Repo auction on March 24

Currently, liquidity in the banking system is estimated to be in deficit of around Rs 76,513.68 crore.

The Reserve Bank of India (RBI) on March 23 said it will conduct a 5-day Variable Rate Repo auction for a notified amount of Rs 75,000 crore.

“On a review of current and evolving liquidity conditions, the Reserve Bank of India has decided to conduct a fine-tuning 5-day Variable Rate Repo (VRR) auction for the fortnight beginning March 24, 2023 instead of the main operation of a 14-day variable rate Repo/ Reverse Repo auction,” RBI said in a release.

The auction will take place on March 24 between 10:30 am and 11 am. The reversal of funds will take place on March 29.

The variable rate repo auction is done to inject liquidity into the banking system when it turns negative or is in deficit.

Currently, liquidity in the banking system is estimated to be in deficit of around Rs 76,513.68 crore.