RBI's first big liquidity mop-up after rate hike falls short as banks park less than half the target

Economic Times - Oct 8, 2026

In a bid to manage liquidity, the Reserve Bank of India executed a 29-day variable rate reverse repo auction, yet banks only stashed away Rs 79,655 crore instead of the anticipated Rs 2 lakh crore. Early fund withdrawal was permitted, but participation remained tepid, mostly because of the daily VRRR options available. The existing inter-bank surplus liquidity sits at Rs 4.24 lakh crore, highlighting ongoing hurdles in monetary transmission.

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