More Stories

Informist, Tuesday, Jun. 16, 2026

 

By Meera Nair

 

MUMBAI – Yields on certificates of deposit and commercial papers fell Tuesday due to comfortable liquidity conditions in the banking system and improved investor appetite after the US and Iran agreed on a peace treaty, dealers said. The three-month CDs and CPs were the most active in the secondary market as investors increased purchases amid easing geopolitical concerns.

 

The net liquidity absorbed by the Reserve Bank of India stood at INR 1.51 trillion on Monday, down from INR 1.73 trillion on Sunday, indicating a slight moderation in the banking system's surplus liquidity. "Liquidity remains 

comfortable and, even if surplus conditions narrow, the RBI can conduct variable rate repo auctions to stabilise funding conditions. Liquidity is unlikely to become a concern in the near term," the dealer at a public-sector bank said.

 

In the secondary market, yields on AAA-rated CDs fell 15–30 basis points in the three-month and one-year segments, while remaining largely unchanged in the six-month tenor. Yield on the three-month CDs fell 15 bps to 6.55-6.60% from 6.70-6.75% on Monday. Six-month yields were range-bound at 7.18-7.20%, compared with 7.20-7.25% Monday, while one-year yields fell 30 bps to 7.15-7.20% from 7.45-7.50% Monday.

 

Yields on AAA-rated CPs issued by non-banking financial companies declined across tenors. The yield on three-month CPs fell 45 bps to 6.60-6.65% from 7.05-7.10% on Monday. Six-month yields eased to 7.45-7.50% from 7.50-7.55%, while one-year yields fell 10 bps to 7.70-7.75% from 7.80-7.85%.

 

"Market sentiment has improved significantly after the announcement of the US-Iran peace deal," a dealer at a public-sector bank said. "Investors are becoming more comfortable taking positions across both short- and long-term maturities, which has led to a rally in the three-month and one-year segments of both CDs and CPs," the dealer at the public-sector bank said.

 

A dealer at a private-sector bank said yields may not decline further from current levels. "If yields fall too sharply now, market participants could face pressure when the rate hike happens... I expect yields to either ease marginally or remain range-bound in the near term," the private sector bank dealer said.

 

CD issuances rose to INR 167.25 billion as of 1737 IST from INR 88.15 billion on Monday, according to data from the Clearing Corp of India Ltd. HDFC Bank, Axis Bank, Punjab National Bank, IndusInd Bank, Equitas Small Finance Bank, and Punjab and Sind Bank tapped the primary market for funds.

 

HDFC Bank raised INR 55 billion through 91-day CDs at a weighted average yield of 6.63%. Axis Bank raised INR 15.25 billion through three-month CDs at 6.60% and INR 38.50 billion through 254-day CDs at 7.35%. Punjab National Bank raised INR 30.50 billion through one-month CDs at 6.20%, while Punjab and Sind Bank raised INR 13 billion through two papers. 

 

CP issuances rose to INR 160.92 billion as of 1742 IST from INR 86.80 billion on Monday. Issuers included Export-Import Bank of India, National Bank for Agriculture and Rural Development, PNB Housing Finance, Motilal Oswal Financial Services, Aditya Birla Money, Motilal Oswal Finvest, Sharekhan, and Tata Projects.

 

EXIM Bank raised INR 30 billion through 91-day CPs at a weighted average yield of 6.88%, while NABARD raised INR 18 billion at 6.72%, according to CCIL data. PNB Housing Finance raised INR 7 billion at 7.12%, while Motilal Oswal Financial Services raised INR 3.75 billion at 7.55% through CPs maturing in 91 and 71 days, respectively.

 

In the secondary market Tuesday, CD trading volume rose to INR 215.85 billion from INR 88.15 billion on Monday, according to CCIL data. CP trading volume also increased to INR 106.80 billion from INR 89.35 billion. "Dealers are more confident about taking positions after geopolitical concerns eased... that has boosted trading activity in both CD and CPs, including in longer-tenor papers," the public sector bank dealer quoted above said.

 

--Primary market
* HDFC Bank, Axis Bank, Punjab National Bank, IndusInd Bank, Equitas Small Finance Bank, and Punjab and Sind Bank raised funds via CDs.

* EXIM Bank, NABARD, PNB Housing Finance, Motilal Oswal Financial Services, Aditya Birla Money, Motilal Oswal Finvest, Sharekhan and Tata Projects were among other CP issuers. 

 

--Secondary market

* Union Bank of India's CD maturing Wednesday was traded 15 times at a weighted average yield of 5.32%
* Bajaj Finance's CP maturing Wednesday was traded four times at a weighted average yield of 5.30%

 

The following were the volumes, in INR billion, in the secondary market for short-term debt at 1811 IST, as detailed on CCIL's F-TRAC platform:

 

Certificates of deposit		Commercial paper
Tuesday	Monday	Tuesday	Monday
215.85	88.15	106.80	89.35

 

End

 

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

 

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.