India bank liquidity surplus set to widen to 5-mth high

Surplus Global

03/04/2025 04:01

India's banking system liquidity surplus set to widen to 5-month high in coming days amid government spending and RBI's bond purchase, traders say

They expect surplus to rise to around 2.5 trillion rupees, the highest since early November

RBI to buy bonds worth 200 billion rupees ($2.33 billion) later in the day, settlement to take place on Friday

"The residual government spending is still happening, and we should see a further rise in surplus in next couple of days," trader with a private bank says

Banking system liquidity moved into surplus on March 29; surplus jumped to 1.42 trillion rupees as on April 1 after being in deficit since mid-December

Traders also expect guidance on liquidity from RBI at its policy review on April 9

($1 = 85.7490 Indian rupees)

 (Reporting by Dharamraj Dhutia)

 ((dharamraj.dhutia@tr.com))