Call money rates remained in the 6.90-7.10 per cent range due to the comfortable liquidity position. Government security prices went up by 5-10 paise at the medium to the long end of the market amidst thin trading.
Call rates opened in the 7-7.10 per cent range and came down a bit to close in the 6.90-6.95 per cent band.
"There was not much demand for overnight money as most of the players have already covered their position for the fortnight and hence rates hovered around the refinance rate," a dealer with a private sector bank said.
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The Reserve Bank of India (RBI) did not receive any bid for its one-day repo as well as reverse-repo auctions.
Prices in the government security market opened 5-10 paise up. According to a dealer, the reason for the price rise was an expected further round of Fed rate cut on August 22. But as there was very little appetite in the market, it did not move in the later hours of the day, he said.
Overnight rates are expected to remain in the 6.75-7 per cent level tomorrow. "As the reporting Friday is approaching, the demand for overnight money is expected to be even thinner tomorrow. We see the call money rates to remain below the seven per cent level for most part of the day," a senior dealer said.
Government security prices are likely to remain rangebound. A dealer with a private sector bank said: "The trading volume will be low and prices should move in a 10-15 paise band. Though the sentiment continues to be good, as the yields have already reached the bottom, there is little scope for them to go down further."