Dhaka, Bangladesh (BBN)– The inter-bank call money rate is unlikely to cross maximum 5.0 per cent on Thursday, the last working day before the Eid vacation, bankers said.
The call money rate moved up slightly in the recent days mainly due to higher withdrawal of cash money from the banks ahead of the Eid, they added.
The call money rate ranged between 1.80 per cent and 5.00 per cent on Tuesday against the previous rate ranging between 1.75 per cent and 5.00 per cent.
Most of the deals were settled at rates varying between 2.50 per cent and 3.50 per cent, according to the market operators said.
However, the weighted average rate (WAR) on call money rose to 3.73 per cent on Tuesday from 3.59 per cent of the previous day. It was 3.52 per cent on June 10.
“The call money rate may not cross 5.0 per cent despite the higher withdrawal of cash before the Eid,” senior treasury officials of different banks predicted.
They said the overall excess liquidity in the banking sector is still in a satisfactory level. “It helps keeping the money market stable despite higher withdrawal of cash from the banks before the Eid-ul-Fitr festival.”
Such short-term borrowing normally increases before the Eid to meet the growing demand for cash money from the banks.
The pressure on cash withdrawal from the banks is easing gradually as the use of both credit and debit cards, also referred as plastic money, are increasing in Bangladesh.
“Online shopping has also contributed to lowering such withdrawal pressure from the banks ahead of the Eid,” a senior treasury official of a leading private commercial bank said.
Besides, a significant number of people are now connect with mobile financial services, agent banking and e-banking that reduces the tendency of holding cash money to their wallets, he explained.
“Currently, the banks are now facing lower demand for cash out of their vaults ahead of festivals like Eid-ul-Azha and Eid-ul-Fitr,” he noted.
Currently, 9.0 million debit cards are being used across the country while the number of issuing credit cards stood at around 1.0 million.