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Home/Business/Banking/Interbank Call Rates Fall to 4.95% Amid …

Interbank Call Rates Fall to 4.95% Amid Easing Demand

Banking
By ThePip Desk•
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A pen rests on a financial report displaying interbank rates. A keyboard and document stack are in the blurred background.

Interbank market rates analysis on a desk, with 4.95% and 5.20% highlighted.

Key Highlights

Interbank call rates dropped to 4.95% from 5.20% as demand for short-term funds eased, signaling lower borrowing costs for banks and potential liquidity stabilization.

Interbank Call Rates Decline

Interbank call rates have dipped to 4.95%, down from 5.20% recorded on Friday. This decrease comes as demand for short-term funds eased during the second week of the reporting fortnight.

Key Market Figures

  • Call rates traded at 4.95%, a reduction from Friday’s 5.20%.
  • The weighted average rate (WAR) in the call money market was 5.30% on Monday, slightly up from 5.27% on Friday.
  • Overnight borrowing rates fluctuated between a high of 5.40% and a low of 4.20%.
  • The TREP (Triparty Repo) market saw a WAR of 5.27% on Monday, with a total volume of Rs 484294.45 crore, as per CCIL data.

Why Demand is Easing

The reduction in call rates is primarily driven by an easing of demand in the interbank market. Banks are borrowing less short-term funds from each other, leading to lower rates.

This trend in the reporting fortnight suggests a potential stabilization or increase in liquidity within the banking system.

CCIL