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Our Bureau

Mumbai April 11 The inter-bank call rate cooled to 3.5 per cent after scaling a peak of over 75 per cent-in the last week of March.

While RBI was lending over Rs 30,000 crore to banks in March, the central bank is now receiving bids from banks to place an excess Rs 43,420 crore through the reverse-repo window.

Since the RBI has capped fund acceptances from banks at Rs 3,000 crore on bids through the reverse-repo window, the surpluses have made their way to the inter-bank call market, say dealers. Banks are also investing excess money in short-term treasury bills.

Call rates closed at 3.50-3.75 per cent on Wednesday against the previous close at 5-5.50 per cent. In the first one-day reverse repo auction, RBI received 23 bids for Rs 24,875 crore while it accepted Rs 1,992 crore (against the limit of Rs 2,000 crore).

In the second-one day reverse repo auction, the RBI received bids 21 worth Rs 18,545 crore but accepted Rs 1,008 crore (against the limit of Rs 1,000 crore). The CBLO market saw 459 trades aggregating Rs 24,606.90 crore in the 1 per cent-5.50 per cent range.

"Some amount of Government spending has led to an increase in liquidity. However, going forward, I don't see call rates ruling at 3 per cent but in the stable range of 5-6 per cent," said Mr P. Mukherjee, Senior Vice-president-Treasury, UTI Bank.

Govt spending

Since the beginning of the new fiscal, government spending of around Rs 18,000 crore-20,000 crore has entered the system. However, the CRR hike by 50 basis points will impound Rs 15,500 crore from the system.

In the secondary market, treasury bills maturing on April 27 closed at 6.20 per cent, against Tuesday's close at 7.5 per cent.

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