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Squarish but Tight
In the narrow interbank call money market in Bombay last week — "narrow," because the volume of fresh money transacted continues to be small — conditions tended to become somewhat tight though the call rate was maintained at four per cent per annum. There were no transactions at lower rates and lenders tried hard to bid up the rate to a high perch by squeezing down supply.
In the narrow interbank call money market in Bombay last week — "narrow," because the volume of fresh money transacted continues to be small — conditions tended to become somewhat tight though the call rate was maintained at four per cent per annum. There were no transactions at lower rates and lenders tried hard to bid up the rate to a high perch by squeezing down supply.
Demand for fresh money emerged with a lag, following the advance quarterly income tax payments of September 1, Judging from the fact that Central Government balances with the Reserve Bank swelled by Rs 48 crores during the week ended September 2, the tax payments must have involved an outflow of the order of Its 50 crores from the banking system.
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