Rally In Gilts Unabated, Call Low

MONEY MARKET REPORT

Security prices continued to rally yesterday with buying seen across maturities. Call money rates remained very easy since yesterday was reporting Friday.

They opened higher but gradually moved down over the day with most deals being done in a range of 5.50 to 5.75 per cent.

Dealers said there continues to be ample liquidity in the banking system as underscored by the big repo subscription of Rs 3,500 crore yesterday.

hey also point to the fact that from today the cash reserve ratio balances would have to be maintained at 65 per cent as compared to 85 per cent earlier.

 

Three day call money rates were seen in a range of 6.25 to 6.75 per cent.

Security prices continued to move up across maturities though with more buying seen in short- and medium-term papers.

While in the short end security prices moved up by 7-8 paise, prices in the longer maturities moved up by 3-4 paise.

"There was a lot of buying in the morning hours with prices in the longer end moving up by 15 paise. However there was a correction later and prices moved down again by about 10 paise," said a dealer with a private bank.

Among the securities which were actively traded were the 11.75 per cent 2001 which saw a turnover of sixty five crore.

It traded in an intraday range of Rs 102.92 to Rs 103 before closing at the latter level underscoring an yield of 9.22 per cent.

The 9.90 per cent 2005 and the 12.25 per cent 2010 securities also saw active trading with turnovers of Rs 215 crore and Rs 185 crore, respectively.