Dhaka, Bangladesh (BBN) – The inter-bank call money rate increased on Wednesday ahead of the Eid-ul-Azha following higher withdrawal of cash from the banks.

The weighted average rate (WAR) on call money rose to 5.48 per cent on the day from 4.88 per cent of the previous working day, according to the central bank’s latest statistics. It was also 4.57 per cent on Monday.

The volume of transactions in the inter-bank call money market came down to BDT 86.87 billion on the day from BDT 95.24 billion of the previous working day, the official data showed.

The call money rate ranged between 4.25 per cent and 6.00 per cent on the day against 4.00-6.00 per cent on Tuesday.

Most of the deals were settled at rates varying between 4.50 per cent and 5.50 per cent, according to market operators.

“The ongoing upward trend of call money rate may continue tomorrow (Thursday), the last working day before the Eid vacation,” a senior treasury official told the BBN.

Such a short-term borrowing normally increases before festivals, as demand for cash grows.

He also said pressure on cash withdrawal from the banks is easing gradually as the use of credit and debit cards, referred to as plastic money, is increasing in Bangladesh.

“A good number of people are now connected with mobile financial services (MFS), agent banking and e-banking that reduces the tendency of holding cash money to their wallets,” the private banker explained.