More Stories

Informist, Monday, May 4, 2026

 

By Shumaila Firoz 

 

MUMBAI – The one-day interbank call money rate ended below the Reserve Bank of India's repo rate of 5.25% Monday amid comfortable liquidity surplus in the banking system, dealers said. The call rate had opened at the repo rate due to early demand for cash but eased below the benchmark rate through the day after banks and primary dealers funded scheduled outflows, they said. 

 

Monday, the one-day call money rate ended at 5.15%, higher than 5.10% Saturday for two-day loans. The weighted average rate was 5.17%, up from 4.88% the previous day. The volume in the call money market was INR 149.49 billion, sharply up from INR 14.61 billion Saturday. 

 

The one-day tri-party repo rate ended at 5.12% Monday, sharply up from 4.53% for two-day loans Saturday. The weighted average rate was 5.03%, higher from 4.81% Saturday. The volume in the tri-party repo market was INR 4.85 trillion, jumping from INR 183.50 billion the previous day. The tri-party rate opened at 5.50%, the highest since Oct. 31. Later in the day, the tri-party rate traded in the range of 4.97% to 5.25%. 

 

The call rate was elevated in early trade due to fund requirements from the primary dealerships and banks, along with the outflows related to the maturity of the four-day variable repo rate auction worth INR 257.15 billion conducted Thursday, dealers said. The payment for the weekly gilt auction also led to INR 290 billion of outflows Monday. 

 

The net liquidity absorbed by the RBI – an indication of surplus liquidity in the banking system – was INR 2.03 trillion Sunday, down from INR 2.05 trillion Saturday, but up from INR 1.72 trillion Friday. Friday's surplus liquidity with banks was the lowest since Mar. 29. With no major outflows scheduled in the fortnight, banks may transfer their surplus funds from cash balances with the RBI to the standing deposit facility, increasing the banking system's liquidity surplus in the coming days, dealers said. 

 

Banks' cash balances with the RBI were INR 8.64 trillion Sunday, more than the average required amount of INR 7.88 trillion for the May 15 fortnight. Liquidity in the banking system dipped as banks parked funds with the RBI to meet cash reserve ratio requirements, particularly after limited market activity over the weekend, dealers said.

 

"Liquidity fell as banks parked money with the RBI for CRR (cash reserve ratio). Since there was not much trading on Saturday, balances remained with the central bank. Liquidity should improve in a day or two," a dealer at a state-owned bank said. Despite the temporary dip, overall liquidity conditions remain comfortable, he added.

 

Dealers are not expecting VRR in the rest of the reporting fortnight as call market rates are expected to remain at or below the repo rate of 5.25%. The one-day tri-party repo rate opened at 5.50% Monday, its highest opening level since Oct. 31, though most traders were surprised and confused about the early panic for funds. The tri-party repo rate traded near the SDF rate for most of the day. 

 

OUTLOOK

Tuesday, the interbank call money rate for one-day loans is likely to open around 5.10-5.15%. Dealers expect the call rate to be at 4.75-5.30% during the day, while the tri-party repo rate is expected to be in the range of 4.80–5.15%, as the liquidity surplus has reduced considerably from its high of INR 5.50 trillion seen in earlier April. 

 

The weighted average call rate will be in the 5.15-5.20% range and that in the tri-party repo market is likely to be in the band of 5.00-5.10% Tuesday, dealers said. 

 

CALL RATE

5.15%--Monday close for one-day loans

5.25%--Monday open for one-day loans

5.10%--Saturday close for two-day loans

 

BENCHMARK MIBOR (in %)  

Mumbai Interbank Outright Rates compiled by Financial Benchmarks India:

 

TENURE	MONDAY	THURSDAY
Overnight	5.23	5.34
3-day	--	--
14-day	5.76	5.74
1-month	5.88	5.86
3-month	6.30	6.31

 

---

India Call: Near SDF as demand eases after VRR and gilt auction outflows

 

MUMBAI – The one-day interbank call money rate hovered around the Reserve Bank of India's Standing Deposit Facility rate Monday after opening higher due to outflows from a variable rate repo auction maturity and payments for government securities, dealers said. Call money market rates also eased as primary dealerships fulfilled their liqudity needs earlier in the day.

 

"Rates in the overnight market were high in the morning because of VRR maturity and gilt payment outflows, but have eased as the impact got absorbed," a dealer at a private sector bank said.

 

At 1630 IST, the one-day call rate was 5.00%, sharply lower than Monday's opening level of 5.25% and also down from Saturday's close of 5.10% for two-day loans. The weighted average call rate was 5.20%, up sharply from 4.88% Saturday. Trading volume was INR 132.49 billion. For the rest of the day, the call money rate is seen in the range of 4.60–5.25%, dealers said.

 

The one-day tri-party repo market rate ended at 5.12%, sharply higher than Saturday's close of 4.53%. The weighted average tri-party repo rate was 5.03%, up from 4.81% Saturday.

 

The net liquidity absorbed by the RBI – an indication of surplus liquidity in the banking system – was INR 2.03 trillion Sunday, down from INR 2.05 trillion Saturday, but up from INR 1.72 trillion Friday, according to the latest data. Friday's surplus liquidity with banks was the lowest since Mar. 29. The redemption of the four-day VRR auction conducted Saturday reduced liquidity with banks by INR 257 billion, with the payment for the weekly gilt auction leading to INR 290 billion of outflows Monday.

 

Liquidity conditions in the banking system remained slightly tight as banks maintained higher-than-required cash balances with the RBI at the beginning of the reporting fortnight ending May 15, dealers said.  Banks' cash balances with the RBI were INR 8.64 trillion Sunday, more than the average required amount of INR 7.88 trillion for the May 15 fortnight. The regulatory requirements had fallen as the cash reserve ratio requirement was calculated on the basis of banks' net demand and time liabilities as on Apr. 15, when deposits had seasonally fallen. In the fortnight ended Apr. 30, banks had to maintain an average cash balance of INR 8.07 trillion.

 

"Liquidity is a bit tight because banks are holding excess cash balances with the RBI at the start of the fortnight, which is weighing on fund availability," a dealer at a public sector bank said. (Shumaila Firoz) 

---

India Call: Rise on early demand for funds, VRR maturity

 

MUMBAI – The one-day interbank call money rate rose on Monday due to early demand for funds from primary dealerships and some banks, but was still below the Reserve Bank of India's repo rate of 5.25%, dealers said. The maturity of the four-day variable rate repo auction conducted Thursday also exerted upward pressure on rates, they said. The one-day tri-party rate opened at 5.50%, the highest since Oct. 31, 2025. 

 

At 0950 IST, the one-day call rate was 5.15%, higher than 5.10% Saturday for two-day loans. The weighted average call rate was 5.25%, also higher from 4.88% the previous day. Trade volume in the call money market was INR 49.47 billion. The one-day tri-party repo rate was 4.99%, up from 4.53% Saturday's two-day loans. The weighted average rate was 5.04%, up from 4.81% the previous session. The volume in the tri-party repo market was INR 1.81 trillion.

 

Dealers said call rates were elevated in early trade due to demand for funds and the maturity of VRR auction conducted Thursday. Primary dealerships were among the key borrowers in the call market. The RBI had conducted a four-day VRR of INR 1 trillion and had accepted all bids worth INR 257.15 billion Thursday.

 

However, liquidity in the banking system remains comfortable and rates are expected to ease as the day progresses, dealers said. "Rates are a bit high due to early demand and the VRR maturity impact, but there is no liquidity crunch and levels should cool down through the session," a dealer at a private-sector bank said.

 

The net liquidity absorbed by the RBI – an indication of surplus liquidity in the banking system – was INR 2.58 trillion Thursday, sharply up from INR 2.15 trillion Wednesday, according to the latest data.  (Shumaila Firoz) 

 

End

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

 

Edited by Deepshikha Bhardwaj

 

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 /+91 (11) 4220-1000

Send comments to feedback@informistmedia.com

 

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