RBI's longer-tenure VRRR auctions receive tepid response as banks prefer shorter maturities
The Reserve Bank of India’s longer-tenure variable rate reverse repo (VRRR) auctions saw weak participation, with banks bidding ₹18,170 crore against ₹1.50 lakh crore on Friday. In contrast, shorter three-day auctions attracted ₹1,39,847 crore. This trend indicates banks prefer shorter maturities despite a liquidity surplus of ₹3.88 lakh crore, complicating the RBI's liquidity management efforts.