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RBI to conduct Overnight Variable Rate Repo auction under LAF on January 20, 2022

Ten News Network

Mumbai (20/01/2022): As stated in Governor’s statement of December 8, 2021 the Reserve Bank has been rebalancing the surplus liquidity in the system by shifting it out of the fixed rate overnight reverse repo window into the variable rate reverse repo (VRRR) auctions of longer maturity. Overall, this rebalancing has proceeded on a pre-announced glidepath and has evolved satisfactorily.

The Reserve Bank will continue to rebalance liquidity conditions in a non-disruptive manner while maintaining adequate liquidity to meet the needs of the productive sectors of the economy. With larger than anticipated collections under the goods and services tax (GST), system liquidity has tightened in this week. This is also reflected in the hardening of overnight money market rates, and in amounts under the fixed rate reverse repo of the liquidity adjustment facility (LAF). Accordingly, it has been decided to conduct a Variable Rate Repo auction on January 20, 2022, Thursday, as under:

Sl. No. Notified Amount
(₹ crore)
Tenor
(day)
Window Timing Date of Reversal
1 50,000 1 1:00 PM to 2:30 PM January 21, 2022
(Friday)

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