RBI Absorbs Net Liquidity of ₹1.97 Lakh Crore as Banking System Retains Cash Surplus
The Reserve Bank of India (RBI) absorbed a net ₹1,96,658.13 crore (approximately ₹1.97 lakh crore) from the financial system on November 5, 2026, according to the central bank's daily money market operations release. The sustained absorption highlights a prevailing cash surplus across the Indian banking sector, driven by healthy bank reserves and moderate short-term funding demands.
The net liquidity figure accounts for both day-to-day liquidity adjustment facility (LAF) actions and outstanding market operations. Net liquidity absorbed through fresh daily operations alone stood at ₹1,81,410.00 crore, while outstanding operations accounted for an additional net absorption of ₹15,248.13 crore.
Breakdown of Central Bank Operations
Commercial banks parked the bulk of their excess funds using the RBI’s non-collateralised liquidity absorption window.
Key Liquidity Operations on November 5:
- Standing Deposit Facility (SDF): Banks deposited ₹1,77,942.00 crore overnight at the SDF rate of 5.25%, making it the primary avenue for mopping up surplus liquidity.
- Variable Rate Reverse Repo (VRRR): The central bank absorbed ₹7,767.00 crore through a 1-day variable rate reverse repo auction at a cut-off rate of 5.49%.
- Marginal Standing Facility (MSF): Financial institutions availed ₹4,299.00 crore under the MSF window at an interest rate of 5.75%.
- Standing Liquidity Facility (SLF): Total utilisation under the standing liquidity facility reached ₹10,306.87 crore.
- Outstanding Operations: A 29-day variable rate reverse repo operation conducted on October 8, maturing on November 6, accounted for ₹25,555.00 crore at 5.49%.
Overnight Money Market Dynamics
Trading activity in the short-term funding market remained robust, with total volume in the overnight segment reaching ₹7,89,757.11 crore. The weighted average overnight rate settled at 5.55%, trading comfortably within the broader daily corridor of 3.50% to 5.85%.
Segment-Wise Overnight Volumes and Rates:
- Triparty Repo (TREPS): The collateralised triparty repo market dominated trading, registering a volume of ₹5,72,289.15 crore at a weighted average rate of 5.53%.
- Market Repo: Interbank market repo saw ₹1,95,543.41 crore in deals at a weighted average rate of 5.61%.
- Call Money: The uncollateralised call money market clocked ₹14,431.90 crore at a weighted average rate of 5.63%.
- Corporate Bond Repo: Repo transactions backed by corporate debt instruments reached ₹7,492.65 crore at a weighted average rate of 5.71%.
In the term segment, market repo recorded ₹1,289.01 crore, while triparty repo stood at ₹7,319.00 crore. Notice money volumes remained low at ₹220.90 crore, and term money volumes closed at ₹819.00 crore.
Banking Reserves and Implications for Investors
Data from the central bank showed that cash balances maintained by scheduled commercial banks with the RBI stood at ₹8,45,116.17 crore as of November 5, comfortably exceeding the minimum cash reserve requirement.
For Indian market participants, the persistent liquidity surplus indicates that banks are well positioned to support credit growth without exerting immediate upward pressure on lending rates. Ample systemic cash also keeps short-term yields on commercial papers and certificates of deposit benign, offering stability to corporate balance sheets and debt mutual fund portfolios.
