Dhaka, Bangladesh (BBN)- The inter-bank call money rate shot up 10 percent on Wednesday as pressure on withdrawal of cash rose ahead of the Eid-ul-Fitr festival, treasury officials said.

The call rate ranged between 4.5 percent and 10 percent on the day against the previous range between 3.75 percent and 8.25 percent. However, most of the deals were settled at rates varying between 7 percent and 8 percent, the market operators said.

“The call money rate increased on the day despite injection of fresh funds by the central bank to keep stable the market,” a senior treasury official of a private commercial bank said, adding that the short-term borrowings normally increase before the Eid festival to meet the growing demand from bank clients.

The central bank of Bangladesh injected fresh funds amounting to BDT 1.21 billion through repurchase agreement (repo) auction at 8.5 percent on the day while BDT 2.348 billion was pumped in the market after buying $34 million from different commercial banks, they said.

The Bangladesh Bank (BB) bought $34 million more from different commercial banks at market rate on the day aiming to keep the inter-bank foreign exchange market stable.

On Tuesday, the central bank similarly purchased $54 million from different commercial banks on the same ground, the BB officials said.

“The central bank has bought the U.S. dollars from the commercial banks to help them comply with the net open position (NOP) rules on maintaining the foreign currency fund,” a BB senior official said.

The BB continues its intervention in the inter-bank foreign exchange market through buying the U.S. currency from the commercial banks directly aiming to keep the market stable.

A total of $1.33 billion was bought from the commercial banks until Sept. 16, as part of the move, the central bank officials confirmed.

In fiscal 2008-09, the BB bought a total of $1.48 billion directly from the commercial banks against only $202.5 million of the previous fiscal, according to the central bank statistics.

The U.S. dollar remained unchanged against Bangladesh Taka (BDT) in the inter-bank foreign exchange market due mainly to a low demand for the greenback.

The banks quoted dollar rate at BDT 69.06 on Wednesday, unchanged from the previous working day in the inter-bank foreign exchange market, the treasury officials confirmed.

BBN/SS/SI/AD-17September09-3:21 am (BST)