Summary of this article
RBI to conduct Rs 1.50 lakh crore 7-day VRR auction
Liquidity surplus at Rs 2.08 lakh crore in system
OMO purchases infused Rs 3.50 lakh crore since January
The Reserve Bank of India (RBI) on Monday said it will conduct a seven-day variable rate repo (VRR) auction of Rs 1.50 lakh crore on March 17.
The VRR auction will take place between 9:30 AM and 10:00 AM on March 17, and the reversal of these funds will take place on March 24, as per the central bank's release.
The central bank announced the auction based on the current and evolving liquidity conditions of the banking system, the release added. Currently, the liquidity in the banking system is estimated to be in surplus of around Rs 2.08 lakh crore.
RBI has infused Rs 3.50 lakh crore of durable liquidity into the banking system through open market purchase (OMO) of government securities since January 2026.
In the last few months, the RBI has been infusing large amounts of liquidity into the banking system to keep overnight rates under control. This has led overnight rates to hover sharply below the repo rate.
Additionally, a heavy supply of liquidity is also expected to help ease the pressure of outflows of funds from the banking system on account of advance tax and goods and services tax, scheduled this month.
