The Reserve Bank of India (RBI) will continue to rebalance liquidity conditions in a non-disruptive manner, said central bank's governor Shaktikanta Das on Wednesday. He said that RBI's aim is to re-establish 14-day Variable Reverse Repo Rate (VRRR) as the main liquidity operation.
The
RBI is to absorb Rs 6.5 lakh crore in VRRR auction on December 17 and absorb Rs 7.5 lakh crore in VRRR auction on December 31.
"From January 2022, liquidity adjustment will be mainly via variable reverse repo auction," Das said.
"We retain flexibility to fine-tune liquidity operations. The RBI will allow banks to make one-time pre-payment with respect to TLTROs announced," he added.
Meanwhile, Reserve Bank of India (RBI) Governor
Shaktikanta Das announced that the central bank has decided to keep key rates unchanged - repo rate - at 4 percent and the stance remains accomodative.
With this, it is the ninth consecutive time since the rate remains unchanged. RBI had last revised its policy repo rate or the short-term lending rate on May 22, 2020 in an off-policy cycle to perk up demand by cutting the interest rate to a historic low.
Das said MPC voted unanimously for keeping interest rate unchanged and decided to continue with its accommodative stance as long as necessary to support growth and keep inflation within the target. RBI retained its growth projection at 9.5 percent for the current fiscal despite concerns over Omicron.
Das also said the headline inflation would peak in the fourth quarter of the current fiscal. The inflation projection has been retained at 5.3 per cent for the current financial year.
(Edited by : Anshul)
First Published: Dec 8, 2021 10:30 AM IST