Dhaka, Bangladesh (BBN) - Liquidity pressure on Bangladesh money market continued in the last week, ended on Thursday despite injecting fresh fund into the market by the central bank.
Overall turnover decreased slightly during the period under review as some banks were reluctant to lend their excesses fund to other banks through call money market mainly due to lower interest rates.
The banks prefer to invest their fund in other forms including deposit to other cash-hungry banks instead of call money market, according to market insiders.
The volume of overall transactions in the market rose to BDT 52.64 billion from BDT 56.65 billion a week ago, according to the central bank’s latest statistics.
However, the weighted average call money rate rose to 4.55 per cent on Thursday from 4.54 per cent a week ago. It was 4.61 per cent on December 27, 2018.
The rate was 2.77 per cent at the end of June 2018. It was 4.03 per cent on December 27, 2017.
On the other hand, the central bank has continuously injected funds in the market through repo auction and assured liquidity support (ALS) to the primary dealer banks like previous weeks.
The existing liquidity pressure may ease slightly this week as cash incentive for apparel and clothing sector has already deposited with some banks.
Besides, a significant amount of fund, provided by the government for implementation of annual development programme has already been disbursed.
BBN/SSR/AD