Dhaka, Bangladesh (BBN)– The amount of overall transaction in the inter-bank repo crossed call money market as the banks prefer to use other windows for investment.
The amount of overall transaction in the inter-bank repo rose to BDT 32.78 billion on Wednesday from BDT 28.10 billion of the previous working day, according to the central bank’s latest statistics.
On the other hand, the volume of overall transaction in the inter-bank call money market came down to BDT 26.21 billion on the day from BDT 30.05 billion a day ago.
The banks prefer to invest their excess funds in the repo mainly due to the higher interest rate than the overnight call money market investment, market insiders said.
The weighted average rate (WAR) on the repo rose to 5.92 per cent on Wednesday from 5.89 per cent of the previous day while the WAR on the call money market reached at 5.09 per cent from 5.05 per cent.
The falling trend of transaction in the call money market may continue in the coming days if the lower interest on the overnight investment continues, they added.
Meanwhile, liquidity pressure on the money market continued as the government’s higher borrowing from the banking system to meet budget deficit partly.