Mumbai,Feb 21 (UNI) The Interbank call money today closed softer at 6.80/7.00 per cent compared with the previous close of 7.80-7.90 per cent, dealers said.
The fall was due to the expectations that tight money conditions would ease as the government will increase spending.
The yield on the 10-year bond ended at 7.92 per cent, down from 8 per cent at the previous close. Total volume was Rs 6200 crore (USD 1.4 billion), with the 7.37 per cent bond maturing in 2014 the most actively traded at Rs 1900 crore.
The central bank is suspected to be buying dollars to check the Rupee's rise and maintain India's export competitiveness.
The impact of the cash reserve ratio (CRR) increase has been completely negated by this intervention.
Last week, the central bank raised the CRR -- the percentage of banks' total deposits they keep with it -- by 50 basis points to 6 per cent in two stages. The first stage kicked off on 17 February, while the next takes effect on March 3.
The measure, which should absorb Rs 1400 crore, is part of efforts to rein in inflation, traders added.
UNI
The fall was due to the expectations that tight money conditions would ease as the government will increase spending.
The yield on the 10-year bond ended at 7.92 per cent, down from 8 per cent at the previous close. Total volume was Rs 6200 crore (USD 1.4 billion), with the 7.37 per cent bond maturing in 2014 the most actively traded at Rs 1900 crore.
The central bank is suspected to be buying dollars to check the Rupee's rise and maintain India's export competitiveness.
The impact of the cash reserve ratio (CRR) increase has been completely negated by this intervention.
Last week, the central bank raised the CRR -- the percentage of banks' total deposits they keep with it -- by 50 basis points to 6 per cent in two stages. The first stage kicked off on 17 February, while the next takes effect on March 3.
The measure, which should absorb Rs 1400 crore, is part of efforts to rein in inflation, traders added.
UNI
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