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Call rates unchanged despite the larger than expected 50 bps rate hike by RBI

26 Jul 2011 Evaluate

Interbank call money rates were currently trading at 7.60% almost unchanged from its previous close of 7.55/60% on Monday. However, the call rates are expected to shoot up as the RBI furthering its hawkish stance against the rampant inflation increased its key policy rate by larger than expected 50 basis points. Thus, with this the repo rate and the reverse repo rate now stand at 8% and 7% respectively.

Banks via Liquidity Adjustment Facility (LAF) borrowed Rs 72,710 crore through repo window on July 26, 2011. While, banks via Liquidity Adjustment Facility (LAF) borrowed Rs 73,215 crore through repo window on July 25, 2011.

The overnight borrowing rates has touched a high of 7.70% 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 7.66% on Tuesday and total volume so far stood at Rs 11,619 crore.

As per CCIL data, WAR in the CBLO (Collateralized Borrowing and Lending Obligation) market was 7.55% on Tuesday and total volume so far stood at Rs 21,703.20 crore.

The indicative call rates which closed at 7.55/60% on  Monday 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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