Call ends steady at 3.50%

Call money rate ended at reverse repo rate of 3.50 per cent as liquidity continued to remain ample in the banking system, dealers said.

The one-day call rate today ended at 3.5-3.6 per cent, compared with 3.6-3.7 per cent for two-day loans on Tuesday.

“Banks are lending around reverse repo rate currently despite ample cash in the system. Call rate is expected to remain rangebound till the Reserve Bank of India (RBI) policy statement,” said a dealer with a private bank.

The RBI will detail its Annual Monetary Policy Statement on April 20. Market participants expect that the central bank to hike interest rates by 25 basis points and also raise banks’ cash reserve ratio by 50 bps due to ample liquidity in the system.

The excess liquidity in the banking system was evident from the bids received by the RBI today at the reverse repo tender.

Banks parked Rs 53,460 crore at the RBI reverse repo operations as against Rs 58,350 crore on Tuesday.