Despite multiple VRRR auctions, banks are holding back, preferring overnight parking over locking funds for 7 days. Why? Simple: they want flexibility. With FCNR(B) deposits flooding in thanks to RBI’s June concessional swap move, the surplus is massive. But absorbing it isn’t easy when banks are playing safe. The RBI might have to pull out bigger guns; like OMO sales or even a CRR hike; to drain this flood. This isn’t just about numbers; it’s about how much control the RBI really has when the market calls the shots. The quiet game of liquidity management just got louder.