More Stories

Informist, Wednesday, Jul. 1, 2026

 

By Meera Nair

 

MUMBAI – Yields on commercial papers and certificates of deposit fell in most tenors Wednesday due to easing quarter-end liquidity pressures and improved buying demand from banks and mutual funds, dealers said. There were no fresh issuances of certificates of deposit for the second consecutive session, with dealers attributing the absence of supply to uncertainty at the start of the new quarter and reduced funding requirements among banks.

 

The banking system moved into liquidity surplus on Tuesday, with the Reserve Bank of India absorbing a net INR 1.13 trillion through liquidity operations, compared with a net injection of INR 130.76 billion on Monday, according to the latest RBI data. "Liquidity will be better by the 8th or 9th of this month (Jul. 8 or Jul. 9), and money will continue to run in the system," a dealer at a brokerage firm said.

 

Three-month AAA-rated CD yields fell sharply to 6.10-6.15% from 6.40-6.45% on Tuesday, while six-month yields eased to 6.60-6.65% from 6.70%-6.75%. One-year CD yields were largely unchanged at 6.95-7.00%, reflecting weaker demand at the longer end of the curve.

 

Among commercial papers, yields on three-month AAA-rated papers issued by non-banking financial companies eased to 6.70-6.75% from 6.80-6.85% on Tuesday. One-year CP yields declined more sharply to 7.10-7.15% from 7.45-7.50%, supported by improved investor demand. "The shorter end is seeing strong buying from mutual funds because liquidity has turned comfortable, while longer-tenor demand remains selective," the dealer said. After the infusion of more liquidity into the banking system, dealers expect a fall of five basis points more in short-term debt market by Monday. 

 

In the secondary market, activity remained concentrated in certificates of deposit as investors repositioned portfolios following the sharp decline in yields. CD trading volume stood at INR 66.25 billion as of 1801 IST, down from INR 96.55 billion on Tuesday, according to Clearing Corp. of India Ltd. data. Commercial paper trading volume also fell to INR 13.50 billion from INR 36.93 billion.

 

Dealers said primary market activity remained subdued as banks continued to benefit from inflows related to FCNR(B) deposits and faced limited incremental funding requirements beyond asset-liability management needs. "There are very few volumes (low issuances) in the primary market because FCNR(B) deposits are coming in," the dealer at the brokerage firm said. "Banks are issuing only to meet asset-liability management mismatches, hence issuance should remain limited," the dealer at the brokerage firm said.

 

There were no CD issuances on Wednesday, marking the second consecutive day without supply in the primary market. Commercial paper issuance also remained moderated. CPs worth INR 18.38 billion were issued on Wednesday, compared with INR 47.28 billion on Tuesday. Among the issuers, Tata Steel raised INR 8 billion through a 90-day commercial paper at a weighted average yield of 6.74%. ICICI Securities raised INR 4 billion through 265-day, 348-day, and 273-day CPs at weighted average yields of 7.23%, 7.50%, and 7.23%, respectively. Other issuers included Julius Baer Capital India, HDFC Securities, Godrej Agrovet, IIFL Capital Services, Nuvama Wealth Management and Goldman Sachs India Finance.
 

--Primary market
* There were no CD issuances Wednesday.  

* Julies Baer Capital India, HDFC Securities, Godrej Agrovet, IIFL Capital Services, Nuvama Wealth Management, Goldman Sachs India Finance, Tata Steel, and ICICI Securities were the major issuers of CPs Wednesday.

 

--Secondary market

* Union Bank of India's CD maturing Thursday was traded three times at a weighted average yield of 5.26%
* Godrej Consumer Products Ltd.'s CP maturing Monday was traded once at a weighted average yield of 6.10%

 

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
Wednesday	Tuesday	Wednesday	Tuesday
66.25	96.55	13.50	36.93

 

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.