RBI should revisit its liquidity policy, rethink using CRR as a regulatory intervention tool: SBI Report

The Reserve Bank of India (RBI) may use the cash reserve ratio (CRR) for regulatory intervention instead of liquidity management. The report by SBI suggests the CRR should be a countercyclical liquidity buffer, and a revision of RBI’s liquidity strategy and policy rate framework is needed.

Feb 4, 2025 - 11:00

RBI should revisit its liquidity policy, rethink using CRR as a regulatory intervention tool: SBI Report

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The Reserve Bank of India (RBI) may use the cash reserve ratio (CRR) for regulatory intervention instead of liquidity management. The report by SBI suggests the CRR should be a countercyclical liquidity buffer, and a revision of RBI’s liquidity strategy and policy rate framework is needed.