Call Rates Close At 3 Per Cent

MONEY MARKET REPORT

Interest rates in the interbank overnight money market opened in the region of 4.25 per cent to 4.5 per cent and declined to 3.5 per cent during the course of the day. They closed in the region of 2.75 per cent to 3 per cent. Money market dealers said that most of the deals were struck in the 3.5 per cent to 4 per cent band.

The reason for the decline in the overnight rates is attributed to the good supply in the market. However, there was hardly any increase in demand from primary dealers. Most of them sold a bulk of their portfolio in the new stock - the 12.14 per cent 2000. The primary dealers are reported to have booked heavy profits. . With reporting Friday around the corner, a majority of the players have covered their position and demand for funds is likely to be low.

 

Keeping with the trend, while there was very little activity in the treasury bills segment, the quotes in the market were at much lower levels. The 364-day treasury bills maturing next April-May were quoted at around 9.3 per cent to 9.4 per cent as against 9.52 per cent two days ago.

The activity in the securities market was concentrated around the 12.14 per cent 2000 which was traded at a premium of 15 paise to 20 paise. Among other securities that were traded include the 12.69 per cent 2002 and the 13.05 per cent 2007. The 12.69 per cent 2002 has attracted the markets attention as the yield is said to be higher than in any other paper.