RBI Actions Cut Banking Liquidity Surplus by Half
Sustained Reserve Bank of India action through bond sales and foreign exchange interventions has helped halve India's banking liquidity surplus. The central bank's measures aim to curb excess cash and address rising inflation pressures.
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The Reserve Bank of India slashed the banking system's liquidity surplus by 55% to 4.92 trillion rupees ($51.36 billion) through targeted bond sales and foreign exchange interventions. The surplus dropped sharply from a record 11.16 trillion rupees recorded two weeks prior. The liquidity contraction aims to curb inflationary risks stemming from massive cash inflows tied to diaspora deposit schemes.
