RBI sucks out liquidity worth Rs 48,387 cr

In the variable rate reverse repo auction held today the Reserve Bank of India (RBI) sucked out liquidity worth Rs 48,387 crore from the system as against the notified amount of Rs 50,000 crore. The total amount of offers received were also 48,387 crore. The cut off rate was 7.99% for the auction.

According to bank treasury officials the excess liquidity in the system was there because of recent government spending which RBI has been sucking out. So far this month RBI has sucked out liquidity over Rs 1 lakh crore. However, despite the drain in liquidity call money rates have been below the repo rate of 8% so far this month.