More Stories

Informist, Wednesday, Aug. 5, 2026

 

By Meera Nair

 

MUMBAI – Rates on certificates of deposit and commercial papers eased by 5-10 basis points across tenors on Wednesday as the Reserve Bank of India's monetary policy decision met market expectations, dealers said. The fall in yields was also supported by surplus liquidity in the banking system, they said. While secondary market turnover declined from the previous session, the primary market remained active due to robust issuances.

 

Three-month certificate of deposit yields declined 10 basis points to 6.60-6.65% on Tuesday, while six-month yields eased 5 bps to 6.75-6.80%. There were no trades in the one-year segment in the secondary market, dealers said.

 

"During the volatile phase in July, participants preferred buying shorter-tenor papers, particularly three-month CDs, to remain flexible. They are now in a comfortable position but still expect three-month yields to ease further to around 6.40-6.50%. Until then, participants are likely to remain in a wait-and-watch mode in that segment while staying active in the one-year segment," a dealer with a brokerage firm said.

 

Three-month AAA-rated commercial papers issued by non-banking finance companies were quoted at 6.95-7.00%, down 5 basis points on Tuesday, while yields on six-month CPs were unchanged at 7.20-7.25%. There were no trades in the one-year segment. Trading activity in both the CD and CP markets remained concentrated in the three-month tenor.

 

Secondary market turnover in certificates of deposit fell to INR 98.55 billion from INR 167.07 billion on Tuesday, according to Clearing Corp. of India Ltd. data. Fresh CD issuances also declined sharply to INR 9.80 billion from INR 45.25 billion.

 

UCO Bank and CSB Bank were the only issuers in the CD market. UCO Bank raised INR 8 billion through a 90-day CD at a weighted average yield of 6.91%, while CSB Bank raised INR 1.80 billion through two CDs at weighted average yields of 7.40% and 7.60%, respectively.

 

Secondary market commercial paper turnover fell to INR 33.25 billion from INR 81.40 billion on Tuesday. However, fresh CP issuances nearly doubled to INR 107.41 billion from INR 54.65 billion in the previous session, reflecting healthy primary market activity despite muted secondary market trading.

 

Export Import Bank of India raised INR 40.00 billion through commercial paper maturing on Nov. 4 at a weighted average yield of 6.77%. Bajaj Finance raised INR 16 billion through 79-day and 91-day papers at weighted average yields of 7.05% and 6.97%, respectively. HDFC Securities raised INR 5 billion at 7.20%, while ICICI Securities raised INR 3.55 billion, according to Clearing Corp. of India data. Axis Securities, Muthoot Fincorp, Tata Capital Housing Finance, Kotak Securities, and Network18 Media and Investments were among the other issuers.

 

"Heavy primary issuances kept secondary market trading subdued today, but as market conditions improve we expect trading activity to pick up over the coming days," the dealer said.

 

The dealer added that the Monetary Policy Committee's decision was largely in line with market expectations and should support participation if current conditions persist.

 

The net liquidity absorbed by the RBI — a proxy for liquidity surplus — stood at INR 3.34 trillion on Tuesday, up sharply from INR 2.44 trillion on Monday as banks reduced their cash balances with the central bank. Cash balances with the RBI fell to INR 7.92 trillion on Tuesday from INR 8.57 trillion on Monday, against an average daily cash reserve requirement of INR 8.03 trillion for the fortnight ending Aug. 15.

   

--Primary market 

* UCO and CSB Bank were the only CD issuers Wednesday.

* Exim Bank, Bajaj Finance, HDFC Securities, ICICI Securities, Muthoot Fincorp, Axis Securities, Muthoot Fincorp, Tata Capital Housing Finance, Kotak Securities, and  Network18 Media and Investments were among CP issuers Wednesday.

 

--Secondary market

* HDFC Bank's CD maturing Thursday was traded three times at a weighted average yield of 5.00%.
* ICICI Securities' CP maturing Thursday was traded three times at a weighted average yield of 5.01%.

 

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
98.55	167.07	33.25	81.40

 

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.