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RBI Sells ₹1 Lakh Crore Net Debt, Biggest Sale in a Decade
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CNBC TV18•28-09-2026, 18:20
RBI Sells ₹1 Lakh Crore Net Debt, Biggest Sale in a Decade
- •India's central bank has net sold bonds worth ₹1 lakh crore this financial year, marking its largest annual net bond sale in over a decade.
- •The Reserve Bank of India is actively withdrawing liquidity from the banking system, which is flush with cash after lenders raised dollars through a special window.
- •Market participants anticipate the total net bond sales could double by December, with expectations of further open-market operations (OMOs) from the RBI.
- •The government's recent reduction in the supply of short-term debt signals a potential increase in RBI's OMOs, aligning with tighter monetary policy expectations.
- •Investors are selling across the yield curve as the government plans to raise borrowing through longer-term securities, keeping the term premium elevated.
Key Questions Answered
The Reserve Bank of India net sold bonds worth ₹1 lakh crore to withdraw liquidity from a banking system flush with cash, which occurred after lenders were allowed to raise dollars through a special window to protect FX reserves and support the rupee.
According to RBI data available since fiscal year 2015, the previous record was set in fiscal year 2018 when the central bank net sold ₹90,000 crore to handle the fallout from the government's abrupt demonetization of ₹500 and ₹1,000 currency notes.
Market participants expect the total net bond sales to potentially double by December. Treasury experts anticipate additional open-market operation sales worth another ₹1 lakh crore or a possible hike in the banks' cash reserve ratio.
