Mumbai, March 7 -- The Reserve Bank of India (RBI) saw tepid demand for its variable rate repo (VRR) auctions as liquidity tightness in the banking system has eased following the central bank's infusion.

Against a notified amount of Rs.50,000 crore, RBI received bids amounting to Rs.8,375 crore at the 14-day VRR auction, indicating low requirement of funds by banks. The easing fund requirement is also reflected in the lower demand being seen in the daily VRR auctions held this week.

Barring Monday (3 March), when RBI saw demand worth Rs.16,557 crore against an auction amount of Rs.25,000 crore, the demand in the daily VRR auctions, too, fell substantially as liquidity in the system eased 4 March onwards.

Against a notified amount of Rs...