The Hindu Business Line : Call rates end marginally down

Call rates were slightly lower at 6-6.05 per cent against the previous close of 6.05- 6.15 per cent. “Call is comfortable now, but it will go up after the advance tax outflow, next week,” said a bank official. In the one-day reverse repo auction in the Liquidity Adjustment Facility, the RBI received and accepted 22 bids for Rs 28,165 crore. There were no repo bids. In the CBLO market, there were 577 trades amounting to Rs 50,262.45 crore in the range of 5.10-6. 05 per cent.

The RBI also announced an additional LAF on March 14 and March 17, in view of the advance tax payments which will happen next week (around March 18) and bank holidays between March 20 - 22. A number of banks had also requested the RBI for additional LAF, said the note issued today. Under additional LAF, the RBI will conduct three-day repo/reverse repo auctions between 4.00- 4.30 P.M. on March 14 and seven-day repo auction between 4.00-4.30 P.M. on March 17. “The RBI has announced the additional LAF in order to avoid demand-supply mismatch and call going to as high as 30 per cent, like last year. This happens when banks’ liquidity dries up and everybody borrows from the call market,” said the official.

— Our Bureau

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