More Stories

Informist, Thursday, Feb. 12, 2026

By Vaishali Tyagi

MUMBAI – The interbank call money rate ended below the Reserve Bank of India's Standing Deposit Facility rate Thursday due to comfortable liquidity surplus in the banking system. "Most part of the day, rates were below SDF only due to ample liquidity, it went above SDF on few trades," a dealer at a private sector bank said.

The one-day call rate ended at 4.60%, against 4.65% Wednesday. The weighted average call rate was 5.04% Thursday, similar to 5.03% Wednesday. The weighted average rate in the broader tri-party repo market rose to 4.79% from 4.66% Wednesday.

According to latest data, the net liquidity absorbed from the banking system by the RBI -- a proxy for the liquidity surplus -- fell to INR 2.86 trillion Wednesday from INR 3.37 trillion Tuesday. Banks parked INR 4.24 trillion under the SDF window Wednesday, down from INR 4.77 trillion Tuesday.

The surplus fell Wednesday due to the payment of INR 476.20 billion for the state bond auction conducted Tuesday. Banks' cash balances with the RBI also rose by INR 85 billion to INR 7.38 trillion, bringing down the net liquidity absorbed, dealers said. Moreover, some dealers said banks made some small tax payments to the government, reducing the surplus liquidity. 

Banks' demand for funds is likely to rise Friday, when they will have to maintain cash balances with the RBI to meet regulatory norms before the end of the reporting fortnight on Sunday, dealers said. Between Feb. 1 and Feb. 11, banks maintained an average daily cash balance of INR 7.64 trillion with the RBI, against the requirement of INR 7.52 trillion for the fortnight.

Dealers do not see any major inflows or outflows on Friday and expect rates to remain around the repo rate, mostly near the RBI's standing deposit facility. "We do not see any major scheduled outflows as of now which can push the rates higher," the dealer quoted above said.

OUTLOOK

On Friday, the three-day call money rate may open below the repo rate of 5.25% due to low demand for funds amid the surplus liquidity in the banking system. During the day, the call rate is expected to move in a range of 4.50-5.15%. Rates are seen inching up as banks look to meet cash reserve requirements at the end of the reporting fortnight, dealers said.

CALL RATE

4.60%--Thursday's close for one-day loans

5.10%--Thursday's open for one-day loans

4.65%--Wednesday's close for one-day loans

BENCHMARK MIBOR (in %)  

Mumbai Interbank Outright Rates compiled by Financial Benchmarks India:

India Call: Below SDF rate; surplus liquidity comfortable despite fall

MUMBAI – The interbank call money rate was below the Reserve Bank of India's Standing Deposit Facility rate of 5.00% due to comfortable systemic liquidity surplus, dealers said. Demand from primary dealerships pushed the rate above the SDF rate in early trade but underlying demand from banks was muted.

At 1100 IST, the one-day call rate was 4.80%, up from Wednesday's close of 4.65%. The weighted average call rate was 5.09%, compared with 5.03% Wednesday. The weighted average call rate is likely to fall during the rest of the day, dealers said.

According to latest data, the net liquidity absorbed from the banking system by the RBI – a proxy for the liquidity surplus – fell to INR 2.86 trillion Wednesday from INR 3.37 trillion Tuesday. Banks parked around INR 500 billion less funds in the SDF window Wednesday, at INR 4.23 trillion.

The surplus fell Wednesday due to the payment of INR 476.20 billion for the state bond auction conducted Tuesday. Banks' cash balances with the RBI also rose by INR 85 billion to INR 7.38 trillion, bringing down the net liquidity absorbed, dealers said. Moreover, some dealers said banks made some small tax payments to the government, reducing surplus liquidity. 

"The SDF parking is down because the overall liquidity is down. It is just an indicator, not a reason," a dealer at a private sector bank said. "There were some outflows from SDL (state bond auction) and also some minor tax payments – not bunched up like GST (goods and services tax), which will start only around Feb. 20."

The weighted average rate in the wider tri-party repo market, which includes mutual funds, was 4.80%, against 4.66% the previous trading day. The triparty repo rate continued to rise for the third day as banks borrowed from mutual funds to park cash as the SDF rate of 5.00%, earning an arbitrage, dealers said. The rates were also higher as the liquidity surplus fell, with no large inflows scheduled in the coming days.

Banks' demand for funds is likely to rise Friday, when they will have to maintain cash balances with the RBI to meet regulatory norms before the the end of the reporting fortnight on Sunday, dealers said. The call money rate would still be below the repo rate in such a case, they said. Between Feb. 1 and Feb. 11, banks maintained an average daily cash balance of INR 7.64 trillion with the RBI, against the requirement of INR 7.52 trillion for the fortnight. (Aaryan Khanna)

End

Edited by Ashish Shirke

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2026. All rights reserved.