The Reserve Bank of India (RBI) on Friday once again conducted a special variable rate repo operation to ease the tight liquidity in the system caused by the larger-than-expected goods and services tax (GST) collection. The central bank offered Rs 75,000 crore to banks, against which they submitted bid worth Rs 1.22 trillion. The cut-off was 4.09 per cent, above the repo rate of 4 per cent. Weighted average call money rates in the interbank market pushed up to a near two-year high of 4.44 per cent.
Observers say this is temporary and is in sync with the revised liquidity