Fall in call money trades may limit RBI rate move impact

The value of trades in the interbank call money market, which helps lubricate the financial system and is the operating target of the RBI’s monetary policy, has shrunk nearly 40% in the past four years, official data showed. Meanwhile, trades in the two other money market segments – market repos and tri-party repos – have trebled, posing a tricky question for the RBI about its rate-action impact on the economy.

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