Call Money ends at 11-12 percent

Mumbai, Apr 18 (UNI) Call money rates today eased to some extent to close at 11-12 percent, compared to yesterday's close of 15-16 percent.

During the day, it touched a high of 13 percent and a low of 10 percent.

The rates had earlier risen following Tuesday's increase in reserve requirements for banks that drained an estimated Rs 7,750 crore from the banking system.

The second leg of the increase in the reserve requirements will take effect on April 28. The call money is currently trading at 10-11 percent, dealers said.

Indian bonds were subdued in early trade today as a bond auction and tight cash conditions saw investors happy to stay out of the market.

Further, the Reserve Bank of India will sell Rs 3,000 crore (USD 715 billion) of market stabilisation bonds.

Rs 7,700 crore government bond issue will mature this weekend and the redemption funds will be arriving in the market by next week, which has contributed to ease the concerns an extended squeeze on cash, dealers said.

The Central Bank will review its monetary policy on April 24. It has raised reserve requirements three times since early December and its short-term lending rate twice in 2007, to try to curb inflation.

UNI