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Friday, October 15, 2021

India Call: Ends below reverse repo rate on surplus liquidity

Informist, Thursday, Oct 14, 2021

 

By Vishal Sangani

 

MUMBAI – The inter-bank call money rate today ended below the Reserve Bank of India’s reverse repo rate of 3.35% because of the prevailing surplus liquidity in the banking system, dealers said.

 

The call rate for four-day loans ended at 3.30%, as against 3.25% on Wednesday for one-day loans.

 

Indian financial markets will be shut on Friday on account of Dussehra.

 

Liquidity in the banking system is estimated to be in a surplus of over 7.64 trln rupees.

 

So far, the RBI has drained 6.00 trln rupees through variable rate reverse repo auctions.

 

Throughout the day, the call rate remained near the reverse repo rate due to subdued demand for funds as no major outflows were scheduled, dealers said.

 

Following are the highlights of the day:

* The weighted average call rate was 3.30% as compared with 3.27% on Wednesday

* TREP (Triparty Repo) weighted average rate was 3.23% as against 3.05% on Wednesday

* Maturity of fixed-rate reverse repo added 2.63 trln rupees to the banking system

 

OUTLOOK

* Indian money market will be closed on Friday on account of Dusshera

* On Saturday, the two-day call money rate may open near the reverse repo rate of 3.35% due to surplus systemic liquidity

* As is usually the case on Saturdays, volumes are expected to be low

* During the day, the call rate is seen at 3.20-3.40%, dealers said.

 

CALL RATE

3.30%–Today’s close for four-day loans

3.40%–Today’s open for four-day loans

3.25%–Wednesday’s close for one-day loans

 

BENCHMARK MIBOR (in %)

Mumbai Inter-Bank Offered Rates compiled by Financial Benchmarks India:

TENURE

TODAY

WEDNESDAY

Overnight

3.39

4-day

3.39

14-day

3.54

3.54

1-month

3.66

3.66

3-month

3.86

3.87

India Call: Near reverse repo rate as surplus liquidity hits demand

 

MUMBAI – The inter-bank call money rate was near the Reserve Bank of India’s reverse repo rate of 3.35% today due to muted demand for funds from banks amid surplus liquidity in the banking system, dealers said.

 

At 1020 IST, the four-day call money rate was at 3.40% as against 3.25% on Wednesday for one-day loans.

 

Indian financial markets will be shut on Friday on account of Dussehra.

 

Liquidity in the banking system is estimated to be in a surplus of over 7.64 trln rupees.

 

So far, the RBI has drained 6.00 trln rupees through variable rate reverse repo auctions.

 

The call rate may remain near the reverse repo rate throughout the day as no major outflows are scheduled.

 

Following are the other highlights:

* The weighted average call rate was 3.39% against 3.27% on Wednesday

* The weighted average rate for triparty repo was 3.09% compared with 3.05% on Wednesday

* The reversal of fixed-rate reverse repo will add 2.63 trln rupees to the banking system

* The call rate is seen within a range of 3.20-3.40% during the day.  (Vishal Sangani)

End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Maheswaran Parameswaran

 

Cogencis news is now Informist. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

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Send comments to [email protected]

 

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Source: Cogencis

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