WACR tops repo rate for the first time in FY26 amid GST outflows
The weighted average overnight call rate (WACR) rose above the Reserve Bank of India’s (RBI’s) policy repo rate of 5.5 per cent on Tuesday for the first time in the current financial year amid Goods and Services Tax (GST) outflows.
WACR settled at 5.62 per cent, against the previous close of 5.48 per cent. The weighted average overnight TREPS (Triparty repo) rate settled at 5.69 per cent, against 5.51 per cent on Monday.
The banking system liquidity was in the surplus of Rs.2.39 trillion on Monday, around 1 per cent of banks’ net demand and time liabilities (NDTL), latest data by the central bank showed.
The central bank has been conducting variable rate reverse repo auctions to suck out liquidity from the system. The WACR is the operating target of the monetary policy and the central bank would like it to align with the policy repo rate.
RBI had said it aims to maintain a liquidity surplus of 1 per cent of NDTL.
Market participants said that with surplus liquidity currently around 1 per cent of net demand and time liabilities (NDTL), it diminishes the likelihood of additional VRRR auctions in the near term.
