Call rates edge significantly lower on penultimate day of reporting fortnight

Interbank call rates were trading at 7.00/10% substantially lower from its previous close of 7.30/40%, as banks already fulfilled their mandatory reserve requirements approaching the fag end of the reporting fortnight. However, call rates were further pushed lower when deputy governor at the RBI on Wednesday stated that Central bank will buy bonds through its open market operation (OMO) if liquidity deficit persistently stays above the comfort level, which is expected to be the scenario after companies make payments towards their advance tax later this month.

The banks via Liquidity Adjustment Facility (LAF) borrowed Rs 2,120 crore through repo window on September 6, 2012, while, the banks borrowed Rs 2,970 crore through repo window and parked Rs 2,380 crore vie reverse repo window on September 5, 2012.

The overnight borrowing rates touched a high and low of 7.90% and 7.00% respectively.

According to the Clearing Corporation of India (CCIL), the weighted average rate (WAR) in the call money market was 7.23% on Thursday  and total volume stood at Rs 24,673.68 crore, so far.

As per CCIL data, WAR in the CBLO (Collateralized Borrowing and Lending Obligation) market was 7.14% on Thursday and total volume stood at Rs 45,643.30 crore, so far.

The indicative call rates which closed at 7.30/40% 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.