India: RBI enhances VRRRs for Dec 21

  • The Reserve Bank of India (RBI) is planning to enhance the 14-day variable reverse repo rate (VRRR) auction amounts in Dec 21.
  • It will conduct VRRR auction for INR6.5tr on 17 Dec 21 and for INR7.5tr on 31 Dec 21. The RBI governor stated that the apex bank was trying to rebalance liquidity conditions in a non-disruptive manner while maintaining adequate liquidity to meet the needs of the productive sectors of the economy.
  • Going forward, the main operation of 14-day VRRRs will continue to be complemented by longer term VRRRs, the size and maturities of which will be decided on the basis of continuous assessment of the evolving liquidity conditions.

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