RBI announces overnight cash withdrawal after 'technical glitch' at 30-day auction
BusinessLine 1 hr ago·7 Sept 2026, 6:00 am
The Reserve Bank of India (RBI) has introduced an overnight 'variable rate reverse repo' (VRRR) auction to manage liquidity after a technical issue halted a scheduled 30-day auction. This new auction allows banks to park funds for just one day, offering them a quick redemption option.
This move is significant for investors as it indicates the central bank is actively managing short-term cash flows to maintain market stability. By providing an immediate exit, the RBI is helping banks navigate the current liquidity situation, which is a key factor for the broader financial system.
Investors should watch the volume of participation in this overnight auction. High demand could signal tight liquidity conditions, while steady participation suggests the market is functioning normally despite the initial technical glitch.
Excerpt from BusinessLine
The Reserve Bank of India announced another cash withdrawal operation on Monday after technical glitches at a longer-term auction depressed participation, five traders said. RBI will conduct an overnight variable rate reverse repo (VRRR) for ₹5 trillion ($52.96 billion), after receiving offers for ₹2.59…Read the original at BusinessLine
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- Category: Economy.
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