MUMBAI: India's inter-bank call money rate rose on Monday, as liquidity conditions remain severely strained in the banking system.
Repo borrowings on Tuesday rose to 1.11 trillion rupees from 942.50 billion rupees on Monday, nearly twice the central bank's comfort zone.
The one-day call rates ended at 8.35/40 percent from last close of 8.30/8.35 percent, and above the repo rate of 8.00 percent.
Meanwhile, the yield on the three-month Reuters CD benchmark rose to 9.45 percent from 9.40 percent, reflecting the higher cost of funding available for banks in the shorter tenure.
Rates on three month commercial paper were at 9.93 percent on Tuesday, higher than 9.79 percent.
A sharp fall in rates for commercial paper is leading to increased sales from Indian financial institutions and corporates looking to raise short-term funding more cheaply than those available from banks.
Volume in the call money market was 323.20 billion rupees, compared with 343.30 billion rupees on Monday, while the weighted average rate was 8.40 percent versus 8.30 percent previously.
Volume in the collateralised borrowing and lending obligation (CBLO) market rose to 366.72 billion rupees versus 345.80 billion rupees, with the weighted average rate at 8.12 percent, lower than 8.19 percent.
In the inter-bank repo market, volume was 164.87 billion rupees from 199.70 billion rupees, with the weighted average rate at 8.09 percent from 8.10 percent.
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