Call rates ebb as demand for funds recede on penultimate day of reporting cycle

Interbank call rates edged lower to 8.15/8.20%, from Wednesday's close of 8.30/35% as demand for funds receded with many banks already covering for their product coverage needs on the penultimate day of ‘Reporting Cycle’. However, record low level by the beleaguered Indian currency, might place some pressure on call rates going further, as likely further intervention of Reserve Bank of India to shore up the feeble currency, might mount pressure on liquidity.

The banks via Liquidity Adjustment Facility (LAF) borrowed Rs 90,010 crore through repo window on May 17, 2012 while, the banks via LAF borrowed Rs 91,400 crore through repo window and parked Rs 10 crore via reverse repo window on May 16, 2012.

The overnight borrowing rates has touched a high of 8.03% and a low of 7.25%, so far.

According to the Clearing Corporation of India (CCIL), the weighted average rate (WAR) in the call money market was 7.98% on Thursday and total volume stood at Rs 28,697.55 crore, so far.

As per CCIL data, WAR in the CBLO (Collateralized Borrowing and Lending Obligation) market was 7.91% on Thursday and total volume stood at Rs 28,642.00 crore, so far.

The indicative call rates which closed at 8.30/35% on Wednesday 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.