The Reserve Bank of India- RBI absorbed liquidity worth 1.10 lakh crore rupees from the banking system on July 9, indicating the presence of surplus cash with lenders despite continued money market activity.

 

According to the RBI’s latest Money Market Operations data the central bank absorbed 1.67 lakh crore rupees through the Standing Deposit Facility (SDF) at an interest rate of 5 per cent, while injecting 46,729 crore rupees through repo operations at 5.26 per cent. The net effect of the day’s liquidity operations resulted in an absorption of 1.20 lakh crore rupees from the banking system. After accounting for outstanding liquidity facilities, the overall net liquidity absorption stood at 1.10 lakh crore rupees. 

 

Activity in the overnight money market remained robust, with total transactions in the overnight segment amounting to 6.91 lakh crore rupees at a weighted average rate of 5.28 per cent. The triparty repo segment accounted for the largest share of transactions at 4.81 lakh crore rupees, followed by market repo transactions worth 1.78 lakh crore rupees and call money transactions of 24,893 crore rupees. 

Banks maintained cash balances of 7.88 lakh crore rupees with the RBI as on July 9, marginally below the average cash reserve requirement of 7.98 lakh crore rupees for the fortnight ending July 15. 

 

The RBI data also showed that the country’s net durable liquidity surplus stood at 4.82 lakh crore rupees as of June 15, reflecting comfortable liquidity conditions in the financial system.