Call money opens higher at 13-14 per cent

Mumbai, Apr 17 (UNI) Call money today opened higher at 13-14 per cent against the previous close of 9.50-10.50 per cent yesterday on tight cash supply.

Liquidity came under pressure after the CRR hike came into effect which was evident from the LAF repo auction for Rs 13,815 crore, leading to higher call rates.

The upcoming bond auction worth Rs 3,000 crore is also likely to sustain pressure on liquidity, said sources.

The first leg of an increase in reserve requirements for banks kicked in on Saturday, draining an estimated Rs 7,750 crore from the system. The second leg takes effect on April 28.

Indian bond yields rose today as tighter conditions in the banking system led traders to off-load bonds to generate funds ahead of a bond issue that will add to the squeeze on cash.

UNI