File photo for representational purposes only. | Photo Credit: Reuters Reserve Bank of India (RBI) has absorbed ₹71,971 crore liquidity from the banking system through overnight Variable Reverse Repo Rate (VRRR) auction, according to a notification released on Tuesday (September 22, 2026).VRRR is the rate at which banks park their funds with the RBI. It is a tool that central banks use to suck liquidity.The VRRR auction was held for ₹75,000 crore and offers were recieved for 96% of the amount for a rate of 5.24%. The overnight facility had a tenor of one day.Keeping in mind that excess liquidity can be inflationary, the RBI has been absorbing excess liquidity from the system, especially after an overwhelming response from the special deposit scheme for NRIs filling up RBI’s coffers with $133 billion.The VRRR operation also intends to bring the overnight call money rate in sync with the repo rate, ahead of a potential rate hike cycle. Published - September 22, 2026 10:45 pm IST
RBI absorbs ₹71,971 crore liquidity from banks
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