Reserve Bank will inject liquidity if needed

The Reserve Bank of India will inject liquidity into the banking system if needed and a recent cut in the government's weekly borrowing was a temporary measure, a deputy governor said on Friday.

"That's a temporary measure," KC Chakrabarty said, referring to a Rs30 billion ($64 million) reduction in the government's scheduled borrowing this week.

"You see we manage the frictional liquidity, soon it will come back. If it is not there, we will introduce the liquidity," Chakrabarty told reporters on the sidelines of a banking event in eastern Indian city of Kolkata.