More Stories

Informist, Wednesday, Apr. 15, 2026

By Durgesh Nandan

MUMBAI – The one-day interbank call money rate ended marginally above the Reserve Bank of India's Standing Deposit Facility rate of 5.00% on Wednesday amid ample surplus liquidity in the banking system and low demand for funds. Dealers said a bank was likely to have borrowed near the end of the trade to meet urgent funding requirements, and due to a lack of options, the trade was done above the SDF rate. The last trade in the call money market on the RBI's Negotiated Dealing System was conducted at 1854 IST for INR 1 billion at 5.08%. 

The one-day call rate ended at 5.08% Wednesday, down from 5.10% for two-day loans Monday. The weighted average call rate was 5.08%, up from 5.04% Monday. Trade volume in the call money market was INR 159.04 billion, similar to INR 159.31 billion Monday. In the call-money market, some small finance banks were on the lending side and, as usual, primary dealerships were the major borrowers ahead of the payment of the Treasury bill auction conducted by the RBI Wednesday and also to meet their daily requirements, dealers said. India's financial markets were shut on Tuesday for Ambedkar Jayanti.

The tri-party repo rate ended at 5.00%, lower from 5.10% for two-day loans Monday. The weighted average rate in the tri-party repo market was 4.78%, down from 4.82% in the previous session. The volume in the tri-party repo market was INR 4.46 trillion, up from INR 4.06 trillion Monday. The volume in the tri-party repo market was higher than usual due to demand from banks for funds on the last day of the reporting fortnight, a dealer at a public-sector bank said.

As per the latest data, the net liquidity absorbed by the RBI, a proxy for surplus liquidity in the system, was INR 5.13 trillion Tuesday, lower than INR 5.24 trillion Monday. The liquidity surplus is likely to remain ample even after the payment of goods and services tax of around INR 1.8 trillion next week, dealers said. 

"We expect the liquidity to be in the same range (INR 5 trillion – INR 5.5 trillion) as there is no major outflow or inflow scheduled this week, but it could fall next week to around 3 lakh crore (INR 3 trillion) after GST (goods and services tax) outflow," a dealer at another public-sector bank said. "Which is still a comfortable position for (surplus) liquidity."

Traders were divided over whether the central bank would conduct a variable-rate reverse repo auction this week. A few dealers said the RBI could conduct an overnight or three- to four-day VRRR for INR 1 trillion–INR 2 trillion. As payment for goods and services tax is scheduled to be paid at the beginning of next week, dealers hope that any VRRR auction conducted reverses within this week itself, so that banks don't face a liquidity crunch. Some said if the RBI doesn't conduct a VRRR this week, Friday's seven-day VRRR would be rolled over for INR 1 trillion. Last Friday, the central bank conducted a seven-day VRRR auction and accepted offers worth INR 2 trillion at a cut-off rate of 5.24%. 

OUTLOOK

Thursday, the one-day call money rate is likely to open at 5.10-5.15% on early demand for funds from primary dealerships and some small banks, dealers said. Dealers expect the rate to be in the range of 4.60–5.15% during the day on the back of ample surplus liquidity in the banking system.

The weighted average call rate is expected to be 5.05-5.15%, while the weighted average tri-party repo rate may be 4.80–4.90%, dealers said. On Thursday, outflows of INR 270 billion for the payment of Treasury bills are scheduled, which will be partly offset by inflows of INR 161 billion from the maturity of Treasury bills and coupons on state bonds.

CALL RATE

5.08%--Wednesday close for one-day loans

5.15%--Wednesday open for one-day loans

5.10%--Monday close for two-day loans

BENCHMARK MIBOR (in %)  

Mumbai Interbank Outright Rates compiled by Financial Benchmarks India:

India Call: Below RBI's SDF; weighted avg above on reporting fortnight-end

MUMBAI – The one-day interbank call money rate was below the Reserve Bank of India's Standing Deposit Facility rate of 5.00% due to surplus liquidity in the system and weak demand for funds, dealers said. After trading below the repo rate in early trading, the rate fell further as primary dealers met their demand for funds, dealers said. However, the weighted average call rate was above the SDF rate on requirements for funds on the last day of the reporting fortnight, dealers said. The call money market rate is expected to remain in the 4.75–5.00% range for the rest of the day, dealers said.

At 1403 IST, the one-day call rate was 4.60%, down from 5.15% at the opening and 5.10% at the close on Monday. The weighted average call rate was 5.10%, higher than 5.04% Monday due to reporting fortnight-end requirements. Trade volume in the call money market was INR 142 billion.

"We can't say the rates are trading below SDF as more than 50 thousand crore (INR 500 billion) of trade has happened above the SDF (Standing Deposit Facility rate) as WAR (weighted average rate) is above the SDF rate," a dealer at a public-sector bank said. 

At 1403 IST, the tri-party repo rate was 4.72%, lower than Wednesday's opening of 4.90% and Monday's close of 5.10%. The weighted average tri-party repo rate was 4.79%, lower than 4.82% Monday, due to surplus liquidity with mutual funds and low demand for funds amid a lack of major outflows, dealers said.

"TREPs (tri-party repo) rate will be in the same range (4.80-5.10%) throughout this month due to surplus liquidity and low demand for funds," a dealer at a private-sector bank said. "TREPs (tri-party repo) rate will only come above SDF (rate) when the (surplus) liquidity will be around (fall to) 2 lakh crore (INR 2 trillion)," the dealer added. 

According to the latest data, the net liquidity absorbed by the RBI, a proxy for surplus liquidity in the system, was INR 5.13 trillion Tuesday, lower than INR 5.24 trillion Monday. Dealers expect the liquidity to be around INR 5.00 trillion till the end of this month.    

Even with ample surplus liquidity, dealers have differing views on whether the central bank will conduct another variable-rate repo auction this month. Some dealers expect a rollover of Friday's seven-day VRRR for at least INR 1 trillion, as there are no major outflows scheduled for the rest of this week, dealers said. However, some other dealers said they don't expect a VRRR to extend into next week as outflows for goods and services tax are scheduled by Apr. 21.

"We are expecting another three-day VRRR for INR 2 trillion by tomorrow (Thursday) evening because of the surplus liquidity in the (banking) system," a dealer at another private-sector bank said. 

Last week, on Friday, the central bank conducted a seven-day VRRR auction and accepted offers worth INR 2 trillion at a cut-off rate of 5.24%. (Durgesh Nandan and Shumaila Firoz)

India Call: Below RBI's repo rate due to ample surplus liquidity in system

MUMBAI – The one-day interbank call money rate was below the Reserve Bank of India's repo rate of 5.25% due to ample liquidity in the banking system, dealers said. However, the call rate was slightly higher than Monday's two-day call rate closing due to usual demand for funds from primary dealerships in early trade, dealers said. The tri-party repo rate was below the RBI's Standing Deposit Facility rate due to surplus liquidity and weak demand for funds, they said.

At 0948 IST, the one-day call rate was 5.05%, down from 5.10% Monday for two-day loans. The weighted average call rate was 5.15%, higher than 5.04% Monday. Trade volume in the call money market was INR 53.65 billion. Money markets were closed on Tuesday for Ambedkar Jayanti.

Dealers expect the call rate to be on the higher side–-closer to the repo rate–- during the day due to the requirement of funds by banks for the reporting fortnight ending Wednesday. The weighted average call rate is expected to fall to around 5.10%, dealers said.

As per the latest figures, the net liquidity absorbed by the RBI was INR 5.24 trillion Monday, lower than INR 5.55 trillion Sunday. The surplus liquidity was broadly steady due to lack of major outflows or inflows Monday and banks may have parked the difference in SDF, dealers said. The major outflow of INR 127 billion for payment of state bonds is scheduled for Wednesday, but it will be offset by inflows of INR 107.5 billion from coupons on state bonds.

At 0948 IST, the tri-party repo rate was 4.78% Wednesday, lower than 5.10% Monday and the weighted average rate was 4.79%, marginally lower than 4.82% Monday. The volume in the tri-party repo market was INR 1.50 trillion. The weighted average tri-party repo rate is likely to be in the range of 4.80–5.05%. The tri-party repo rate has been continuously trading below the RBI's SDF rate because of investment of funds in mutual funds at the beginning of the financial year 2026-27 (Apr-Mar).

"We are expecting a three-day VRRR today (Wednesday) for 1 lakh crore (INR 1 trillion) – 1.5 lakh crore (INR 1.5 trillion) as there is ample liquidity in the system and no major outflow is scheduled this week," a dealer at a private sector bank said. "On Apr. 17 (Friday), inflows for redemptions and payments on coupons for state bonds are scheduled, so the RBI may conduct another VRRR," the dealer added.

Despite ample liquidity, dealers are divided about whether the central bank will conduct another variable rate reverse repo auction this week or not. Some dealers expect the RBI to conduct an overnight or three-four day VRRR. A few dealers expect a rollover of INR 2 trillion from Friday's seven-day VRRR as there are no major outflows scheduled this week. A few dealers said they don't expect a VRRR this week as goods and services outflows are scheduled by Apr. 21. 

The central bank conducted a seven-day VRRR auction Friday for INR 2 trillion. The VRRR auction was oversubscribed for INR 2.09 trillion due to ample surplus liquidity in the banking system. (Durgesh Nandan)

End

Edited by Saji George Titus

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.