Dhaka, Bangladesh (BBN) - The inter-bank call money rate hit 32 percent on Thursday due mainly to squeeze liquidity support by the central bank, officials said.
The call rate ranged between 16 percent and 32 percent on the day against 7.0-31 per cent of the previous working day. However, most of the deals were settled at rates varying between 20 percent and 24 percent, the treasury officials added.
“The call money rate has increased slightly on the day following squeezing liquidity support through repurchase agreement (Repo) auction by the central bank” a senior treasury official of a commercial bank said.
On Thursday, the Bangladesh Bank (BB) received 15 bids of three-day tenor amounting to total of BDT 23.5379 billion. But the central bank provided BDT 5.8845 billion against the bids, according to the central bank auction result.
“The Repo auction will continue in line with the existing monetary policy,” a BB senior official told BBN in Dhaka without elaborating.
The treasury official said the upward trend of call money may continue until December 15 for taking preparation to meet the new cash reserve requirement (CRR) by the banks.
On December 1 last, the central bank raised the by 0.5 percentage points to 6.0 per cent for the commercial banks to curb inflationary pressure on the economy.
BBN/SI/AD-10Dec10-1:21 am (BST)