Operators in the money market were of the opinion that the rates will remain on the higher side as there is little scope for the pressure on liquidity to ease.
On Saturday, calls were unchanged from the previous day's figure, quoting between 10.5 and 10.75 per cent.
An outflow of Rs 2,000 crore on account of the 13.85-per cent 10-year paper is due to take place today.
There was an outgo of Rs 1,250 crore on August 24 towards the installment payment for the partly-paid stock.
Bankers feel the new 10-year paper will either devolve, or barely scrape through with full subscription.
Since the rates even on a three-year paper are quoting between 13.70 and 13.75 per cent in the secondary market, treasury heads did not evince interest in the 13.85-per cent gilt.
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This is the third ten-year paper in the last five months, following the 14-per cent 2005 private placement issue on March 25 for Rs 3,000 crore and the 13.85- per cent partly-paid stock issued on June 24 for Rs 5,000 crore.
This week, after the two outflows towards the 10-year paper and the partly-paid stock occurring in quick succession, the call rates are likely to hover on the higher side.
As a result of the high call rates, trading activity in the government securities market will be marginal.
Last week, though the 91-day treasury bills continued to attract a number of deals, there was a slowdown in volumes due to the tightness prevailing in the money markets.
A moderate amount of voucher trading in the 13.5-per cent 1997 security was also believed to have taken place in view of the fact that interest payment on this paper is due soon.
The cut-off yield on the 91-day treasury bill rose from 9.48 per cent to 10 per cent, signaling a tightening of liquidity in the system.
The preceding week had seen a 100-basis points increase in the yield on this short-term instrument, from 8.48 per cent to 9.48 per cent. Participating banks bid at a higher cut-off figure, indicating their preference for higher yields.
At the auction, the primary dealers received a lower commission of 12.5 paise on a face value of Rs 100 compared with 25 paise earlier.
The narrow difference between the weighted average price and the cut-off price for the 91-day treasury bill auctions was a reflection of the fine bidding taking place at the auctions.