The Inter-bank call money rates opened at 7.65%, substantially higher from its previous close of 7.50/60% on Tuesday as the banks are scuttling to meet mandated reserve requirements in the first week of the reporting fortnight. Demand is typically higher in the first week of a reporting fortnight as banks borrow more than their mandated requirements to avoid last minute rush for funds. However, the rates are seen capped at 7.70% as a major strain on liquidity is unlikely.
Banks via Liquidity Adjustment Facility (LAF) borrowed Rs 13,795 crore through repo window on July 06, 2011. While, banks via Liquidity Adjustment Facility (LAF) borrowed Rs 14,750 crore through repo window and Rs 170 crore via reverse repo window on July 05, 2011.
The overnight borrowing rates has touched a high of 7.65% and a low of 7.45%, so far.
According to the Clearing Corporation of India (CCIL), the weighted average rate (WAR) in the call money market was 7.58% on Wednesday and total volume so far stood at Rs 12,774.00 crore.
As per CCIL data, WAR in the CBLO (Collateralized Borrowing and Lending Obligation) market was 7.41% on Wednesday and total volume so far stood at Rs 46,336.45 crore.
The indicative call rates which closed at 7.50/60% on Tuesday 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.
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