Overview
- The Reserve Bank of India will hold a three-day variable rate repo auction of Rs 75,000 crore on March 20, with reversal on March 23.
- Surplus liquidity is currently estimated at about Rs 81,964 crore, reflecting sharp swings around fiscal year-end tax payments.
- On March 17, the RBI injected Rs 48,014 crore via a seven-day VRR at a 5.26% cut-off and weighted average rate, well below the Rs 1.50 lakh crore offered.
- Liquidity is expected to tighten further with upcoming GST outflows later this week, according to market reporting.
- Banks showed limited appetite for the seven-day funds, with calls for more flexible options such as prepayments, while durable OMOs since January 2026 have totaled around Rs 3.5 lakh crore and helped keep overnight rates below the repo rate.