CP rates fall 15-20 bps

Rates on commercial papers fell 15-20 basis points on Thursday, as fund houses stepped up purchases on inflows in their liquid schemes, dealers said.

Three-month CDs were dealt at 8.80-8.90 per cent, as against 8.95-9.05 per cent Wednesday.

Three-month commercial papers dealt at 9.00-9.10 per cent, compared with 9.35-9.55 per cent.

Rates on one-year papers were 9.50-9.70 per cent, as against 9.55-9.75 per cent Wednesday.

“Fund houses bought commercial papers on Thursday because most of the papers were maturing in three months and due to inflows in their schemes. There are also views that the rates may fall next week,” said a dealer with a mutual fund.

 

Investors also bought short-term instruments on Thursday as most papers will be issued next week and inflows are likely to be higher then.

Around Rs 430 crore worth of CPs were placed on Thursday. On Thursday, banks raised around Rs 2,550 crore via CDs, as against Rs 2,700 crore on Wednesday. So far this month, banks have raised Rs 44,200 crore through CDs, as against Rs 25,300 crore in November.