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Weekly policy watch: RBI liquidity move, IIP data, forex reserves in focus

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Weekly policy watch: RBI liquidity move, IIP data, forex reserves in focus

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Weekly policy watch: RBI liquidity move, IIP data, forex reserves in focus

The week's policy calendar will focus on RBI liquidity management, industrial production and forex reserves

The RBI will conduct a seven-day VRRR auction on Monday to absorb ₹2.5 trillion from the banking system. (Photo: Reuters)

Rimjhim Singh New Delhi 4 min read Last Updated : Aug 24 2026 | 10:09 AM IST

India’s policy and economic calendar this week will focus on liquidity conditions in the banking system, industrial activity and the country’s external financial position.

The key developments include the Reserve Bank of India ’s variable rate reverse repo (VRRR) auction, the release of industrial production data and fresh foreign exchange reserves figures.

The Reserve Bank of India will conduct a seven-day variable rate reverse repo (VRRR) auction on Monday to absorb ₹2.5 trillion from the banking system.

The move comes after banks parked ₹95,970 crore with the RBI under a three-day VRRR auction on Friday, against the notified amount of ₹1.5 trillion.

A VRRR auction is used by the central bank to temporarily absorb excess liquidity from the banking system. Net liquidity in the banking system stood at a surplus of ₹3.5 trillion on Thursday, according to the latest RBI data.

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