More Stories

Informist, Tuesday, Feb. 17, 2026

 

By J. Navya Sruthi

 

MUMBAI – Rates on certificates of deposit and commercial papers were steady on Tuesday in both primary and secondary markets due to lack of fresh cues, dealers said. However, most dealers said rates are likely to ease going forward due to ample liquidity surplus in the banking system. 

 

In the secondary market, indicative rates on CDs were largely unchanged from the previous day due to thin trade. Indicative rates on one-year CDs were steady from the previous day at 6.82-6.85%. Rates on three-month and six-month CDs were unchanged from the previous day at 6.90-7.00% and 7.05-7.05%, respectively, dealers said. Indicative rates on CPs issued by non-banking finance companies were steady at 7.35-7.40% and those by manufacturing companies were steady at 7.10-7.15%, dealers said. Currently, dealers see higher demand for six-month and one-year CDs as these are highly liquid.

 

In the primary market, Federal Bank raised INR 10 billion Tuesday through a CD maturing in January 2027 at 7.03%. Punjab National Bank, DCB Bank, and UCO Bank also issued CDs. UCO Bank raised INR 5 billion at 7.04% through one-year CD and DCB Bank raised INR 2.5 billion at 7.50% through CDs maturing in May.   

 

"Although rates are steady, there is a slight downward bias because of ample liquidity," a dealer at a state-owned bank said. "I feel the RBI (Reserve Bank of India) is forcing transmission in short-term market as it is not bringing any VRRR (variable rate reverse repo)," the dealer said. "All CD rates above 7% are expected to fall at 7% or below by mid-March," the dealer said. 

 

"Earlier, SIDBI (Small Industries Development Bank of India) and NABARD (National Bank for Agriculture and Rural Development) July or August maturity CPs were around 7.35-7.40%...now, if we see these are around 7.10-7.15% and this (fall) is purely because of liquidity surplus," a dealer at a private sector bank said. "For the transmission to continue, we just need clarity that the RBI will not bring VRRR." Most dealers also do not see the RBI coming up with a variable rate reverse repo as outflows for goods and services tax payments are scheduled to start on Friday.   

 

According to the latest data, the net liquidity absorbed from the banking system by the RBI – a proxy for the liquidity surplus – was at INR 2.59 trillion Monday, down from INR 3.18 trillion Sunday. Although the surplus in the banking system was lower Monday, it is still at a comfortable level. Also, the decline in liquidity was because banks increased cash balances with the RBI to INR 8.06 trillion Monday from INR 7.28 trillion Sunday.

 

The trading volume of CD in the secondary market Tuesday was INR 236.80 billion, significantly up from INR 127.45 billion Monday. The trading volume in the CP market was INR 42.85 billion, down from INR 48.90 billion Monday.

 

--Primary Market

* Federal Bank, UCO Bank, DCB Bank, and Indian Overseas Bank raised funds through CDs

 

--Secondary market

* HDFC Bank's CD maturing Wednesday was traded 13 times at a weighted average yield of 4.9149%

* Reliance Retail Ventures' CP maturing Wednesday was traded thrice at a weighted average yield of 4.8917%

 

The following were the volumes, in INR billion, in the secondary market for short-term debt at 1700 IST, as detailed by the Clearing Corp. of India's F-TRAC platform:

 

Certificates of deposit		Commercial paper
Tuesday	Monday	Tuesday	Monday
236.80	127.45	42.85	48.90

 

End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Tanima Banerjee

 

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.