More Stories

Informist, Friday, May 29, 2026

 

By Meera Nair

 

MUMBAI – Rates on certificates of deposit and commercial papers fell sharply on Friday as investor appetite improved, with sentiment in the money market strengthening following a sharp decline in Brent crude oil prices, dealers said. 

 

"Markets are expected to improve and people expect volatility to ease, hence activity was higher today," a dealer at a private-sector bank said. "Global prospects are improving...US-Iran tensions are less likely to escalate, and crude oil prices also fell today. Overall, markets are getting better and this has boosted confidence among participants."

 

Yields on three-month and six-month CD fell 30-35 basis points from Wednesday. Yields on AAA-rated three-month CDs were at 7.20-7.25% Friday, sharply lower from 7.55-7.62% Wednesday, while six-month CDs were at 7.50-7.55%, down 30 basis points from 7.80-7.90%. One-year CD yields were down at 7.75-7.79% marginally down from 7.80-7.90% Wednesday. Three-month CDs were the most actively traded papers in the secondary market. Money markets were closed on Thursday on account of Id-ul-Zuha.

 

Issuances in the CD market rose as most of the fundraising was for rollover of papers maturing at month-end, and issuances are likely to rise in the near term if market sentiment improves and liquidity remains tight in the banking system, dealers said. As of 1755 IST, issuances of CDs totalled INR 77.00 billion Friday, sharply higher than INR 15.00 billion on Wednesday, according to data from the Clearing Corp of India Ltd.

 

The net liquidity absorbed by the RBI, an indication of surplus liquidity in the banking system, was INR 674.82 billion Thursday, marginally up from INR 668.98 billion Wednesday.

 

Canara Bank, Indian Bank, Bank of India, The Jammu and Kashmir Bank Ltd., DCB Bank Ltd., and Punjab and Sind Bank raised money through CD issuances. Canara Bank raised INR 27.25 billion at weighted average yield of 7.21% through CD maturing on Aug. 31, while Indian Bank raised INR 20 billion through the same maturity CD at a weighted average yield of 7.25%. Other key issuer was Bank of India which raised INR 17.75 billion at 7.30% through CD maturing on Aug. 31. 

 

The Jammu and Kashmir Bank issued three-month CD to raise INR 5 billion, while DCB Bank raised INR 4 billion and Punjab and Sind Bank raised INR 3 billion through similar maturity paper.

 

On the CP side, yields fell 10-15 basis points across tenures Friday. Yields on AAA-rated CPs issued by non-banking financial companies were at 7.90-7.95%, down 10 basis points from 8.00-8.05% on Wednesday, while similarly rated six-month CPs were at 8.00-8.05%, down 15 basis points from 8.15-8.20%. One-year CP yields were at 8.10-8.15%, down 10 basis points from 8.20-8.25%.

 

Issuances in CPs also rose to INR 116.95 billion Friday, higher than INR 110.15 billion on Wednesday, according to CCIL data at 1853. HDB Financial Services, LIC Housing Finance, Tata Steel, and Kotak Securities were among the key issuers. While other companies like Digitide Soltutions, Trust Investment Advisors, Whizdm Finance also tapped the short-term debt market to raise funds.

 

HDB Financial Services raised INR 2.5 billion through seven-day CP at a weighted average yield of 7.15%, while LIC Housing Finance and Tata Steel raised INR 20 billion each, through the CP maturing on Aug. 27 at weighted average yields of 7.64% and 7.75%, respectively. Kotak Securities raised INR 6.5 billion through three-month CPs at a weighted average yield of 8.20%.

 

In the secondary market, CDs worth INR 157.25 billion were traded as of 1905 IST on Friday, sharply higher than INR 125.00 billion on Wednesday, according to Clearing Corp of India Ltd. data. CPs worth INR 48.81 billion were traded on Friday, up from INR 40.00 billion on Wednesday. "Volume of both CDs and CPs in the secondary markets was higher today (Friday) as participants wanted to book profits and activity increased on hopes that market conditions would improve in the coming weeks," the dealer at the private bank said.

 

--Primary market
* Canara Bank, Indian Bank, The Jammu and Kashmir Bank Ltd., DCB Bank Ltd., Bank of India, and Punjab and Sind Bank were the only issuers that raised funds via CDs 

* HDB Financial Services Ltd., LIC Housing Finance Ltd., Tata Steel Ltd., and Kotak Securities Ltd. were among those that raised funds via CPs

 

--Secondary market

* Union Bank of India's CD maturing Monday was traded eight times at a weighted average yield of 5.41%
* Export Import Bank of India's CP maturing Monday was traded 15 times at a weighted average yield of 5.40%

 

The following were the volumes, in INR billion, in the secondary market for short-term debt at 1700 IST, as detailed on CCIL's F-TRAC platform:

 

Certificates of deposit		Commercial paper
Friday	Wednesday	Friday	Wednesday
157.25	125.00	48.81	40.00

 

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

Send comments to feedback@informistmedia.com

 

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