Issuances of certificates of deposit (CDs) fell on Wednesday because banks preferred to remain on the sidelines due to the abundant liquidity in the banking system, dealers said.
Banks on Wednesday placed Rs 900 crore worth of CDs, compared with around Rs 2,000 crore on Tuesday.
Abundant liquidity in the system was seen as banks parked Rs 77,500 crore in Reserve Bank of India’s reverse repo tender on Wednesday, compared with Rs 47,770 crore on Tuesday. The rates have also fallen significantly since mid-April as liquidity continued to remain abundant in the system.