RBI to Auction Rs 1.5 Lakh Cr VRR on May 25

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May 22, 2026 20:17

RBI announces Rs 1.50 lakh crore 4-day VRR auction on May 25 to manage liquidity. Details on auction timing and reversal date inside.

RBI to Auction Rs 1.5 Lakh Cr VRR on May 25

Illustration: Uttam Ghosh/Rediff.com

Mumbai, May 22 (PTI) The Reserve Bank of India (RBI) on Friday said it will conduct four-day variable rate repo (VRR) auction for a notified amount of Rs 1.50 lakh crore on May 25.

The auction will take place between 9.30 am and 10 am and the reversal of these funds will be on May 29, according to the RBI's notification.

"On a review of current and evolving liquidity conditions, it has been decided to conduct a Variable Rate Repo (VRR) auction on Monday, May 25, 2026," RBI said in a release.

Currently, the liquidity in the banking system is estimated to be in surplus of around Rs 58,876.29 crore. The surplus liquidity has narrowed in last four days by 1.90 lakh crore following the outflows on account of goods and services tax (GST) from banking system.

This has led to a spike in overnight call money rates to trade above the RBI's repo rate of 5.25 per cent.

On Friday, the central bank infused Rs 81,590 crore transient liquidity into the banking system through a three-day VRR auction.

Transient liquidity is temporary cash flow fluctuations in a financial or banking system, while a VRR auction is a monetary tool used by the RBI to inject short-term liquidity into the banking system.

Source: PTI By Rediff Money Desk, Mumbai

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