Call rate continues to rise
Wednesday, 19 December 2007
FE Report
Mounting demand for cash ahead of festival vacation kept the inter-bank call money rate in ascending mood Tuesday in a highly active market influenced by pre-Eid withdrawals.
The rate jumped to its peak at 17.00 per cent against previous day's high of 16.00 per cent, fund managers said.
The central bank refrained from withdrawing cash using its controlling tool, but the market behaviour maintained its rising trend, they said.
The US dollar, however, lost ground with its lowest floor halting at Tk 68.48 against previous day's Tk 68.55.
The commercial banks facing sturdy demand for ready cash from clients tried hard to prevent the call rate from further rising on the day, but the mismatch between demand and supply pushed the overnight borrowing rate upward, banking sector sources said.
Bankers forecast continuation of rising pressure of demand for cash today ( Wednesday), they said.
The call rate in its extreme range moved between 8.00 per cent and 17.00 per cent against previous day's range of between 8.00 per cent and 16.00 per cent, fund managers said.
In most deals, the rates, however, moved between 10.00 per cent and 16.00 per cent against previous day's range of between 9.00 per cent and 14.00 per cent in the inter-bank market, they added.
The surge in demand for cash was mainly attributed to increased business activities ahead of Eid festival, they said.
Some of the banks and non-banking financial institutions also borrowed cash from the inter-bank market at high rates to meet immediate requirements of their clients. It also attributed to the rise in call rate, fund managers said.
UNB adds, Fund managers said Sonali Bank had to send Tk 3.50 billion to their branches Tuesday to meet the increased demand for cash withdrawal while Janata Bank sent Tk 2.50 billion and Agrani Bank sent Tk 2.25 billion to their branches respectively.
Major lender banks of the day were Sonali, Janata, Agrani, National, IFIC, UCBL and The City Bank Limited while major borrowers included Rupali Bank and other small banks.
The US dollar was, on the other hand, dropped against the Bangladesh taka (BDT) on the day in the inter-bank foreign exchange market because of sufficient supply and steady transactions of the greenback, fund managers said.
The exchange rate of the dollar varied between Tk 68.48 and Tk 68.61 against the previous day's range of between Tk 68.55 and Tk 68.61 in the inter-bank foreign exchange market.
The greenback, however, slightly gained in public deals and the cash dollar was exchanged at rates varying between Tk 67.48 and Tk 69.75 against previous day's range of between Tk 67.45 and Tk 69.75.
In the informal market, the dollar remained mostly steady and it was traded at rates ranging between Tk 67.30 and Tk 67.70 against the previous day's range of between Tk 67.30 and Tk 67.60. The informal market experienced steady demand for the dollar on the day, money dealers said.
Mounting demand for cash ahead of festival vacation kept the inter-bank call money rate in ascending mood Tuesday in a highly active market influenced by pre-Eid withdrawals.
The rate jumped to its peak at 17.00 per cent against previous day's high of 16.00 per cent, fund managers said.
The central bank refrained from withdrawing cash using its controlling tool, but the market behaviour maintained its rising trend, they said.
The US dollar, however, lost ground with its lowest floor halting at Tk 68.48 against previous day's Tk 68.55.
The commercial banks facing sturdy demand for ready cash from clients tried hard to prevent the call rate from further rising on the day, but the mismatch between demand and supply pushed the overnight borrowing rate upward, banking sector sources said.
Bankers forecast continuation of rising pressure of demand for cash today ( Wednesday), they said.
The call rate in its extreme range moved between 8.00 per cent and 17.00 per cent against previous day's range of between 8.00 per cent and 16.00 per cent, fund managers said.
In most deals, the rates, however, moved between 10.00 per cent and 16.00 per cent against previous day's range of between 9.00 per cent and 14.00 per cent in the inter-bank market, they added.
The surge in demand for cash was mainly attributed to increased business activities ahead of Eid festival, they said.
Some of the banks and non-banking financial institutions also borrowed cash from the inter-bank market at high rates to meet immediate requirements of their clients. It also attributed to the rise in call rate, fund managers said.
UNB adds, Fund managers said Sonali Bank had to send Tk 3.50 billion to their branches Tuesday to meet the increased demand for cash withdrawal while Janata Bank sent Tk 2.50 billion and Agrani Bank sent Tk 2.25 billion to their branches respectively.
Major lender banks of the day were Sonali, Janata, Agrani, National, IFIC, UCBL and The City Bank Limited while major borrowers included Rupali Bank and other small banks.
The US dollar was, on the other hand, dropped against the Bangladesh taka (BDT) on the day in the inter-bank foreign exchange market because of sufficient supply and steady transactions of the greenback, fund managers said.
The exchange rate of the dollar varied between Tk 68.48 and Tk 68.61 against the previous day's range of between Tk 68.55 and Tk 68.61 in the inter-bank foreign exchange market.
The greenback, however, slightly gained in public deals and the cash dollar was exchanged at rates varying between Tk 67.48 and Tk 69.75 against previous day's range of between Tk 67.45 and Tk 69.75.
In the informal market, the dollar remained mostly steady and it was traded at rates ranging between Tk 67.30 and Tk 67.70 against the previous day's range of between Tk 67.30 and Tk 67.60. The informal market experienced steady demand for the dollar on the day, money dealers said.