Call Tumbles To 1-2% Levels

MONY MARKET REPORT

Call rate crashed to one-two per cent in the wake of excess liquidity in the money market. After opening in the 9.10-9.25 per cent band it came down to 8-8.50 per cent. The rate declined further to below two per cent. The weighted average call money rate of STCI was 6.92 per cent on a turnover of Rs 1,200 crore.

The Reserve Bank of India (RBI) received 12 bids for Rs 1,876 crore at the three-day nine per cent fixed rate repos.

On Saturday, the apex bank had mopped up Rs 1,170 crore which is slated to come in today.Though Rs 3,046 crore was parked in repos, call rate declined. One of the financial institutions was reportedly flush with funds.

The excess liquidity has prompted the central bank to undertake sell-buy swaps in the forex market to suck out a portion of surplus funds.In the morning, there was some buying interest and prices of securities improved. Among treasury bills, those maturing in April were dealt at 10.5-11.75 per cent.

Among securities, the 13.50 per cent paper maturing in 1998 was traded at Rs 100.35, the 13.70 per cent 1999 at Rs 102.50, the 10.85 per cent 2001 at Rs 97.40, the 12.14 per cent 2000 at Rs 101, the 12.50 per cent 2004 at Rs 101.05-101.05, and the 12.59 per cent 2004 at Rs 101.50.