Call rates trade in a tight band on Monday

31 Oct 2011 Evaluate

Interbank call money rates were trading at 8.50/8.55%, little changed from Friday's close of 8.55/8.60%, as supply was adequate to meet demand. On Saturday, it had closed at 8.50/55% in an illiquid market. Since, it is second week of the reporting fortnight, so demand is unlikely to throw any surprise, hence uptake in cash rates is unlikely. Further, fund demand could be lower this week also as many banks had over borrowed earlier last week expecting the central bank to nudge repo rate higher.

The banks via Liquidity Adjustment Facility (LAF) borrowed Rs 52,385 crore through repo window on October 31, 2011. Meanwhile, banks via LAF only borrowed Rs 59,345 crore through repo window and parked Rs 900 crore via reverse repo window on October 28, 2011.

The overnight borrowing rates has touched a high of 8.51% and a low of 7.60%, so far.

According to the Clearing Corporation of India (CCIL), the weighted average rate (WAR) in the call money market was 8.46% on Monday and total volume stood at Rs 7041.49 crore.

As per CCIL data, WAR in the CBLO (Collateralized Borrowing and Lending Obligation) market was 8.48% on Monday and total volume stood at Rs 30,526.65 crore.

The indicative call rates which closed at 8.50/55% on Saturday were contributions made from Andhra Bank, AXIS Bank, Bank of America, Bank of Baroda, Bank of India, Canara Bank, J P Morgan Chase, Citibank N.A., Corporation Bank, Credit Agricole Bank, Indusind Bank, ICICI Bank, ICICI Securities, IDBI Bank, Jammu and Kashmir Bank, Punjab National Bank, RBS, Societe Generale, Standard Chartered Bank, State Bank of India, Union Bank of India, ING Vysya Bank, BNP Paribas, HDFC Bank, P&S Bank.