Although the Reserve Bank of India had announced a phased cut to the cash reserve ratio (CRR) to inject more liquidity, much of that infusion got absorbed by FX intervention and maturing forwards. Analysts say the net liquidity boost was less than expected, which could keep short-term funding rates firm despite the market’s bullish mood. This paradox of liquidity squeeze amid strong equity rallies underscores how FX operations are crowding out monetary easing benefits for traders and debt markets.