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Informist, Saturday, Aug. 1, 2026

By Janwee Prajapati

MUMBAI – The two-day interbank call money rate ended below the Reserve Bank of India's Standing Deposit Facility rate of 5.00% Saturday on subdued demand for funds over the weekend amid surplus liquidity in the banking system, dealers said. The call rate and volumes were low due to limited participation as compared to weekdays. The fall in the rate and volumes is the norm on Saturdays with most banks that need funds on the weekend meeting their requirements Friday.

The two-day call rate settled at 4.85% Saturday, down sharply from 5.35% Friday for three-day loans. The weighted average call rate was 4.95%, also down sharply from 5.37% the previous day. The trade volume in the call money market slumped to INR 13.62 billion from INR 126.21 billion Friday. The call rate moved between a high of 5.35% and a low of 4.70% throughout the day.

The tri-party repo rate for two-day loans ended at 4.63%, down from 4.96% Friday for three-day loans. The weighted average rate was 4.84%, also down sharply from 5.21% Friday. The volume in the broader tri-party repo market plunged to INR 95.34 billion from INR 4.61 trillion in the previous session. The tri-party repo rate moved in the 5.05-4.50% band Saturday.

The net liquidity absorbed by the RBI Thursday was INR 1.30 trillion, up from INR 1.16 trillion Wednesday because of some inflows from month-end spending by government, dealers said. The absorption indicates the surplus liquidity in the banking system. Cash balances with the RBI also rose to INR 8.19 trillion Thursday from INR 7.91 trillion Wednesday.

OUTLOOK
The one-day interbank call money rate Monday is likely to open around the RBI's repo rate of 5.25% on early funding requirements from primary dealerships and some banks, dealers said. Surplus liquidity is expected to increase over the weekend due to inflows from the Centre's expenditure, dealers said. Traders also expect the inflows from foreign currency non-resident (banks) deposits to support the rise in surplus liquidity in the banking system, they said. The inflows are expected to keep rates in the money market near the lower end of the Liquidity Adjustment Facility corridor, they said.

Dealers expect the call rate Monday to be in the 4.60–5.45% range. The tri-party repo rate is expected to be in the 4.60–5.40% band. The weighted average call rate is expected to be in the 5.25–5.40% band and that in the tri-party repo market is likely to be in the 5.15–5.25% band, they said.  End

Edited by Rajeev Pai

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