Call money rate now 7.45pc

Business Desk :
The interbank call money rate rose further to a record 7.45% on October 12 from 6.56% on October 4 following a policy rate hike.

The increase in liquidity pressure led to a steady rise in weighted average call money rate since September 12, when it stood at 6.34%.

The rate experienced a sharp spike as the Bangladesh Bank on October 5 raised the policy rate by 75 basis points, moving it from 6.5% to 7.25% to combat inflationary pressures.

The move was in line with the central bank’s introduction of an interest rate corridor in its monetary policy statement on July 18, which allows the interbank call money rate to fluctuate around the policy rate.

The call money rate is the interest rate on a short-term or overnight loan from one bank to another to meet an urgent requirement.

Banks typically resort to these emergency loans to rectify asset-liability mismatches, fulfill statutory CRR and SLR requirements and respond to sudden surges in fund demands.