Call Rates Easy, Gilts Dip On Profit-Booking

Call money rates remained easy and ruled in the range of 7 per cent to 7.25 per cent today because of comfortable liquidity and recovery of rupee against dollar. The prices of government securities moved down by 15-20 paise due to profit-booking.

Call rates opened higher in the range of 7.15 per cent to 7.25 per cent and came down gradually to close in the 7 to 7.10 per cent band.

Dealers said most of the deals were done in the range of 7.05 per cent to 7.15 per cent.

A dealer with a private sector bank said, "The liquidity condition remained good and also the there was no pressure from the forex market as the rupee appreciated against dollar further. This made the overnight rates to remain low."

 

The Reserve Bank of India (RBI) did not receive any bid for its one day repo and reverse repo auctions. Dealers said large lenders preferred to route their money to call market instead of repo window.

The prices of government security prices fell despite the recovery in the rupee. Dealers said the move was correction to yesterday's appreciation. However, they added that the sentiment in the securities market was positive.

The treasury head of a private bank said, "The prices of securities had gone up too much yesterday as the forex market turned stable. Today's fall in the prices are correction to that."

Call money rates are likely to remain in the range of 6.75 per cent to 7.25 per cent tomorrow on the back of a stable rupee and easy liquidity condition in the money mart. Government security prices are expected to remain stable with prices moving in a 15-20 paise band on either side of today's level.

A dealer with a nationalised bank said, "The sentiment in the securities market has been positive today and will continue to do so. But the prices may not rise too much as they are already at very high levels."