WACR stood at 5.25% in March and at 5.00% in February, RBI data showed. Consequently, banking system liquidity stood at a daily average surplus of Rs 1.57 lakh crore in March and Rs 2.53 lakh crore in February.
“Our attempt, of course, is to keep the WACR as near as possible to the policy rate. However, in times like this when there is so much uncertainty, we want to give comfort to banks that liquidity will not be in deficit. So that’s why we have allowed WACR to be at the lower end of the LAF corridor,” RBI governor Sanjay Malhotra said in his post-policy press conference.
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The SDF rate is the lower (floor) rate of the LAF corridor at 5%, while the marginal standing facility (MSF) rate is the upper (ceiling) rate at 5.50%. The policy repo rate is in the middle of the corridor at 5.25%
Liquidity will be comfortable in the banking system, Malhotra said, dismissing the link between lower WACR and a higher rate-cut probability.
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