RBI steps up fund infusion as system liquidity 'almost neutral'

Rates on CPs, CDs surge; pressure mounts on banks to raise deposits

Increased demand for cash during the festival season, a slow pace of government spending, tax outflows, and the central bank’s interventions in the currency market have led to the overall liquidity surplus in the banking system almost entirely drying up, analysts said.

Over the last five days, the Reserve Bank of India (RBI) has injected a daily average of Rs 72,456 crore worth of funds into the banking system. The cash infusion on October 25 nearly hit the Rs 1-trillion mark, at Rs 98,372.89 crore – the largest since April 24, 2019, when the RBI had infused funds worth Rs