MUMBAI: RBI has drawn a roadmap to reduce surplus liquidity by over Rs 5 lakh crore by December 2021 even as the monetary policy committee has chosen to maintain a status quo on rates and its accommodative stance as well as growth projections.
This could be as good as it gets for borrowers as the withdrawal of liquidity will put pressure on bond yields, which could eventually get passed on to loans as well.
Announcing the liquidity normalisation roadmap, governor Shaktikanta Das said currently surplus liquidity is at an average of Rs 9.5 lakh crore in October so far and the potential liquidity overhang amounts to more than Rs 13 lakh crore. RBI plans to bring down the surplus liquidity so that its borrowings from banks under the reverse repo operation would come down to Rs 2-3 lakh crore by December 2021. It is currently around Rs 8.8 lakh crore. “We do not want suddenness. We do…
This could be as good as it gets for borrowers as the withdrawal of liquidity will put pressure on bond yields, which could eventually get passed on to loans as well.
Announcing the liquidity normalisation roadmap, governor Shaktikanta Das said currently surplus liquidity is at an average of Rs 9.5 lakh crore in October so far and the potential liquidity overhang amounts to more than Rs 13 lakh crore. RBI plans to bring down the surplus liquidity so that its borrowings from banks under the reverse repo operation would come down to Rs 2-3 lakh crore by December 2021. It is currently around Rs 8.8 lakh crore. “We do not want suddenness. We do…
