Tools of Liquidity Management

Liquidity management tools enable the Reserve Bank of India (RBI) to maintain adequate banking system liquidity, ensuring price stability, efficient credit flow, and economic growth.

Recent Developments

  • Daily variable rate repo auctions discontinued from June 11, 2025, due to surplus liquidity.
  • Repo rate at 5.50% (June 2025).
  • SDF rate at 5.25%, serving as LAF corridor floor.
  • Variable rate repo and reverse repo used for agile liquidity response.

Nodal Authority

  • Reserve Bank of India (RBI) is the primary authority administering liquidity management.

Contribution to GDP

  • Efficient liquidity tools promote stable credit availability and interest rates, sustaining investment ....
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Indian Economy