Call money rates move 5.68-6.47 per cent in June

Weighted call money rates ranged 5.68-6.47 per cent during June, against 6.03-6.55 per cent in May and 5.44-7.64 per cent in June last year.

Weighted Call Money Rates: July 2015- June 2016
Month Call Money Rates (%)
Jul-15 5.79-7.12
Aug-15 5.45-7.31
Sep-15 5.93-7.88
Oct-15 5.55-7.02
Nov-15 5.61-7.21
Dec-15 5.83-6.99
Jan-16 5.61-7.04
Feb-16 6.37-7.11
Mar-16 6.12-8.95
Apr-16 5.79-6.44
May-16 6.03-6.55
Jun-16 5.68-6.47

Policy repo rate stood at 6.5 per cent, reverse repo rate at 6 per cent and bank rate 7 per cent as of 1 July. CRR stood at 4 per cent. Base rate, below which banks are allowed to lend, ranged 9.30-9.70 per cent, whereas marginal cost of funds based overnight lending rate (MCLR) introduced by RBI since 1 April worked out to 8.90-9.15 per cent. The base term deposit rates were assessed at 7.00-7.50 per cent in the week ended 1 July (8.00-8.50 per cent a year ago).

Base rate & MCLR

Unlike Base Rate which is minimum common for specific loan tenors, MCLR is different for loans with different tenors. Tenor is the period after which the interest rate of a loan resets. Basically, the MCLR will be published by the banks each month. If you take a loan with a 1 year tenor in April 2016, then your interest rate will be reset in April 2017 and according to the MCLR of that month.

Trend in Lending & Deposit Rates
Week ended MCLR (Overnight)  Term Deposit Rates
15-Apr 8.95/9.15 7.00/7.50
22-Apr 8.95/9.15 7.00/7.50
29-Apr 8.95/9.15 7.00/8.00
6-May 8.90/9.15 7.00/7.50
13-May 8.90/9.15 7.00/7.50
20-May 8.90/9.15 7.00/7.50
27-May 8.90/9.15 7.00/7.50
3-Jun 8.90/9.15 7.00/7.50
10-Jun 8.90/9.15 7.00/7.50
17-Jun 8.90/9.15 7.00/7.60
24-Jun 8.90/9.15 7.00/7.60
1-Jul 8.90/9.15 7.00/7.50

 The cut-off rate on 182 days T-bills auction on 29 June worked out to 6.82 per cent, while that on 91 days on the same day worked out to 6.73 per cent. The cut-off rate on 364 days T-bills floated on 22 June worked out to 6.90 per cent.

Yield on 10 year Central government security worked out 7.43 per cent in the week ended 1 July (7.79 per cent a year ago). Rupee depreciated against USD by 6.4 per cent and 6.3 per cent against Euro. Six months premium against USD was at 6.2 per cent.

Commercial papers floated during the first fortnight of June ranged 6.69-13.30 per cent, against 6.77-12.75 per cent on those floated in the second fortnight of May.

Certificates of deposits issued in the fortnight ended 10 June involved interest rates of 6.96-7.66 per cent, against 7.12-7.66 per cent on those issued in the preceding fortnight.

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