RBI intends to bring excess liquidity to neutral position

RBI measures will ensure the surplus does not stoke inflation

TACKLING SURPLUS CASH

Using conventional and unconventional instruments, the Reserve Bank of India intends to bring excess liquidity to the neutral position. These measures will ensure the surplus does not stoke inflation. In a separate move, the central bank also allowed banks to invest in REITs and InvITs.

Problem of plenty

"RBI will use SDF after amendments have been made to the RBI Act. This will give the regulator more flexibility to manage its liquidity operations. It expects liquidity conditions to remain in surplus in the short run. Remonetisation accelerated in Jan-Mar with currency in circulation increasing cumulatively