The Reserve Bank of India conducted a 4-day Variable Rate Repo (VRR) auction on October 26, 2026, allotting ₹1,50,007 crore at a cut-off rate of 5.55%, with a weighted average rate of 5.59%. The auction saw high demand, with bids totaling ₹1,86,666 crore.
4-Day VRR Auction Concluded with Strong Response
The Reserve Bank of India (RBI) successfully conducted a 4-day Variable Rate Repo (VRR) auction under the Liquidity Adjustment Facility (LAF) on October 26, 2026, allotting ₹1,50,007 crore—slightly exceeding the notified amount of ₹1,50,000 crore. The cut-off rate was set at 5.55%, while the weighted average rate stood at 5.59%. The auction witnessed robust bidding, with total bids received amounting to ₹1,86,666 crore, reflecting sustained liquidity demand in the system.
A notable feature of the auction was the partial allotment mechanism at the cut-off rate, with 85.07% of the bids at the threshold rate being allocated. This indicates a competitive bidding environment and effective liquidity absorption management by the RBI. The window for the auction remained open from 9:30 AM to 10:00 AM, with the reversal date scheduled for October 30, 2026.
Such VRR operations are part of the RBI’s proactive liquidity management strategy, especially amid fluctuating money market conditions. For practitioners, this underscores the importance of monitoring near-term monetary policy signals and repo auction outcomes, which directly influence short-term interest rates and interbank lending dynamics.
