The Reserve Bank of India (RBI) conducted a 3-day Variable Rate Reverse Repo (VRRR) auction on 18 August 2025, aiming to absorb excess liquidity from the banking system. The notified amount for the auction was Rs 25,000 crore, while the total amount of offers received stood at Rs 23,360 crore, the same amount was accepted by the RBI. The cut-off rate for the auction was set at 5.49%, with a weighted average rate of 5.48%.
This VRRR auction, part of RBI's ongoing liquidity management operations, is designed to keep short-term market rates aligned with the policy repo rate by absorbing surplus funds from banks. The RBI has conducted similar VRRR auctions in preceding days to manage the impact of government spending and other market flows.
No partial acceptance percentage was recorded for offers received at the cut-off rate, and all offers up to the notified amount were fully accepted. The RBI remains vigilant, carrying out such fine-tuning operations frequently to anchor money market rates and efficiently manage systemic liquidity.