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Call rates edge lower despite the start of fresh reporting fortnight

27 Jan 2014 Evaluate

Interbank call rates were trading lower at 8.30/8.35% from the previous close of 8.60/8.65% on Friday and Marginal Standing Facility (MSF) rate of 8.75% , on the first day of new reporting cycle on account of enough liquidity in the banking system. However, the rates could edge higher in the coming days as banks usually prefer borrowing for their fortnightly requirements in the first week of reporting fortnight to avoid the volatility of rates going further.

The banks via Liquidity Adjustment Facility (LAF) borrowed Rs 37705 crore through repo window on January 27, 2014, while banks using LAF facility borrowed Rs 28293 crore through repo window and parked Rs 2509 crore via reverse repo window on January 23, 2014.

The overnight borrowing rates touched a high and low of 8.35% and 8.00% respectively.

According to the Clearing Corporation of India (CCIL), the weighted average rate (WAR) in the call money market was 8.15% on Monday and total volume stood at Rs 24611.38 crore, so far.

As per CCIL data, WAR in the CBLO (Collateralized Borrowing and Lending Obligation) market was 8.20% on Monday and total volume stood at Rs 29856.25 crore, so far.

The indicative call rates which closed 8.60/65% on Friday 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, so far.

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