Call rate moves downward
Saturday, 2 February 2008
Sarwar Zahan
The inter-bank call money rate closed at low last week with injection of fresh cash into the market by the central bank and higher inflow of cash withdrawn earlier, fund managers said.
The market started the week with high pressure on liquidity, but the liquidity position started improving from the middle of the week because of injecting fresh cash into the market through repurchase agreement by the central bank. It forced the call rate to move downward. In the concluding days of the week the lowest edge of the call rate coincided with the bank rate of 5.00 per cent.
The call rate moved between 5.00 per cent and 12.00 per cent in the concluding days of the week against the previous week's level of 7.00 per cent and 20.00 per cent. The rate, however, moved mainly between 5.00 per cent and 10.00 per cent in most deals against the previous week's range between 8.00 per cent and 15.00 per cent.
The central bank injected Tk 5.545 billion into the market through repo auction at an annual interest rate of 8.50 per cent to ease the pressure on liquidity.
The central bank, however, withdraw Tk 2.06 billion through reverse repo auctions at an annual interest rate of 6.50 per cent in the closing session considering that the liquidity position came back to a comfortable level.
The government borrowed Tk 9.00 billion Sunday through auctions of treasury bills. This resulted in withdrawal of Tk 9.00 billion from the market.
Bidders offered Tk 5.70 billion, Tk 3.00 billion and Tk 1.467 billion against 28-day, 91-day and 364-day bills respectively.
The central bank, however, accepted Tk 700 million, Tk 500 million and Tk 67 million against 28-day, 91-day and 364-day bills respectively.
Besides, Tk 4.30 billion, Tk 2.00 billion and Tk 1.433 billion were devolved to primary dealers for 28-day, 91-day and 364-day bills respectively.
The ranges of the implicit yields against the accepted bills respectively were 7.30-7.33 per cent, 7.63 per cent and 8.45 per cent per annum.
The net outflow of cash from the market was expected to put increased pressure on liquidity, the fund managers said. The dealer banks borrowed money mainly at rates varying between 5.00 per cent and 10.00 per cent among them in the inter-bank market against the previous week's range between 6.00 per cent and 15.00 per cent.
The inter-bank call money rate closed at low last week with injection of fresh cash into the market by the central bank and higher inflow of cash withdrawn earlier, fund managers said.
The market started the week with high pressure on liquidity, but the liquidity position started improving from the middle of the week because of injecting fresh cash into the market through repurchase agreement by the central bank. It forced the call rate to move downward. In the concluding days of the week the lowest edge of the call rate coincided with the bank rate of 5.00 per cent.
The call rate moved between 5.00 per cent and 12.00 per cent in the concluding days of the week against the previous week's level of 7.00 per cent and 20.00 per cent. The rate, however, moved mainly between 5.00 per cent and 10.00 per cent in most deals against the previous week's range between 8.00 per cent and 15.00 per cent.
The central bank injected Tk 5.545 billion into the market through repo auction at an annual interest rate of 8.50 per cent to ease the pressure on liquidity.
The central bank, however, withdraw Tk 2.06 billion through reverse repo auctions at an annual interest rate of 6.50 per cent in the closing session considering that the liquidity position came back to a comfortable level.
The government borrowed Tk 9.00 billion Sunday through auctions of treasury bills. This resulted in withdrawal of Tk 9.00 billion from the market.
Bidders offered Tk 5.70 billion, Tk 3.00 billion and Tk 1.467 billion against 28-day, 91-day and 364-day bills respectively.
The central bank, however, accepted Tk 700 million, Tk 500 million and Tk 67 million against 28-day, 91-day and 364-day bills respectively.
Besides, Tk 4.30 billion, Tk 2.00 billion and Tk 1.433 billion were devolved to primary dealers for 28-day, 91-day and 364-day bills respectively.
The ranges of the implicit yields against the accepted bills respectively were 7.30-7.33 per cent, 7.63 per cent and 8.45 per cent per annum.
The net outflow of cash from the market was expected to put increased pressure on liquidity, the fund managers said. The dealer banks borrowed money mainly at rates varying between 5.00 per cent and 10.00 per cent among them in the inter-bank market against the previous week's range between 6.00 per cent and 15.00 per cent.