Call Rates Hover Around 4 Per Cent

Rates in the inter-bank call money market moved between 3.5 per cent and 4 per cent yesterday. A slight tightening was seen in the call rates due to the four-day repos auction by the RBI, which set a cut off rate of 4 per cent.

In the morning, lenders were reported to be quoting rates as high as 5 per cent, but no borroweres were forthcoming at these levels. Most of the lending was done by institutions like the UTI.

Dealers in the money market had expected a higher subscription for the paper than the amount received, which was Rs 1,325 crore. Due to this, dealers said, call rates may not see much tightening.

 

``The amount of outflow from the system is not as much as anticipated. Due to this, the rates may not jump to a large extent, said a dealer.

The liquidity position within the banking system continued to be comfortable.

There was no significant rise in prices in the government securities market, though some security prices witnessee a marginal upward movement.

The 13.5 per cent 1997 paper improved to Rs 103.10, but the 13.5 per cent 1998 security remained at more or less the same levels.