MONEY
RBI slates Rs 25,000-cr bond sales, tightens daily CRR norms to suck out excess liquidity
- IBJ Bureau
- Oct 10, 2026
The Reserve Bank of India (RBI) has announced the next leg of open market bond sales andtightened daily maintenance of Cash Reserve Ratio (CRR) in a bid to drain rupee liquidity further from the banking system.
The RBI India will sell Rs 25,000 crore of bonds on Tuesday through open market operations (OMOs), an effective liquidity-draining tool.
The regulator has also mandated that banks willneed to maintain 99 per cent of the daily CRR from October 16 against 90 per cent earlier.
The moves come days after the RBI raised itskey policy rate for the first time in nearly four years and signalledmore rate hikes.
The central bank had not announced any liquidity-draining measures in the policy.
RBI Governor Sanjay Malhotra had said that the surge in liquidity would not be a long-term phenomenon and a large amount of liquidity would get absorbed within this financialyear that ends in March 2027.
Last month, the RBI had sold bonds worth Rs lakh crore, the highest net sale in over a decade.
Markets should be prepared for the liquidity surplus to fall below 1 per cent of deposits and potentially lie in the range of 0 to 0.5 per cent of deposits in the coming quarters, ICICI Securities Primary Dealership has said in a note.
“OMO sales have led to a bear flattening of the yield curve,” the primary dealer has added.
Liquidity surplus in the banking system has averaged more than Rs 7 lakh crore on a daily basis from September 1, amounting to 2.6 per cent of deposits.
The RBI will sell bonds maturing from FY30 to FY35, including 7.88 per cent 2030, 6.10 per cent 2031, 7.95 per cent 2032, 7.26 per cent 2033, 7.18 per cent 2033 and 7.10 per cent 2034 notes.
Banks park 3 per cent of their deposits withthe RBI under CRR, and do not earn any income on these funds.
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