The interest rate in Bangladesh’s call money market has reached a record high, with the average rate for one-day loans rising to 10.09%. Since November 13, the rate has remained above 10%. Banks lend money to each other in the call money market, particularly when facing liquidity shortages. Recently, interest rates for longer-term loans have also surged, reaching 12% for four-day loans and 11.88% for seven-day loans. Many banks are struggling with severe liquidity shortages, making it difficult to meet customer demands. Some banks prefer investing in treasury bills rather than participating in the call money market, reducing market participation. Experts also note that the liquidity crisis is exacerbated by Bangladesh Bank’s reduction in repo auctions.
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