By Admin 
RBI News: Ever since the war between Iran and the US, the country’s economy had gone haywire. The impact of inflation also reached the pockets of the common people. No sector was spared from the brunt of this inflation. Even the functioning of the banking system has been greatly affected. Due to this, recently RBI has taken a step so that the functioning of the banking system continues smoothly.
RBI removed the cash shortage
In fact, recently RBI i.e. Reserve Bank of India has injected some cash to overcome the shortage of cash in the banking system. RBI on Tuesday infused temporary cash of more than Rs 1.41 lakh crore into the banking system through the 7-day Variable Rate Repo (VRR) auction. With this, the functioning of the bank will continue to run smoothly. At the same time, the public will also benefit from this.
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Cash shortage in banks
According to news agency IANS, in recent times, due to GST payment, a large amount of money went out of the banks, due to which there was a shortage of cash in the banking system. Due to which pressure on short-term interest rates started increasing. In such a situation, RBI had to intervene and provide funds to the banks at the rate of 5.26%, so that they do not face shortage of money and the functioning of the banks continues smoothly.
Let us tell you that when there is less cash in the banking system due to tax payment or other reasons, RBI provides money to the banks temporarily through measures like repo auction. At the same time, to increase liquidity for the long term, the central bank also adopts measures like buying government bonds and dollar-rupee swap. Its purpose is to ensure that due to lack of money in the market, interest rates do not increase suddenly and the pace of the economy is not affected.
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