In a move to enhance market liquidity and operational flexibility, the Reserve Bank of India (RBI) has decided to extend trading hours for the call money, market repo, and Tri-Party Repo (TREP) segments. These changes are set to be implemented starting July 1, 2025, and August 1, 2025, respectively.
Why is this Important?
The RBI’s decision to revise trading timings for specific financial markets is based on recommendations from an expert working group. These changes aim to meet the evolving needs of market participants, improve liquidity management, and align with global standards.
Key Details
What is Call Money Market?
- The call money market is an uncollateralized, overnight borrowing market.
- It is utilized by banks and standalone primary dealers (SPDs) for short-term liquidity management.
Revised Timings
Call Money Market
- Current timing: 9:00 AM to 5:00 PM
- New timing (effective July 1, 2025): 9:00 AM to 7:00 PM
Market Repo & Tri-Party Repo (TREP)
- Market Repo current timing: Closes at 2:30 PM
- TREP current timing: Closes at 3:00 PM
- New timing (effective August 1, 2025): 9:00 AM to 4:00 PM
Objective and Significance
- Enhance operational flexibility for financial institutions.
- Improve liquidity adjustment facility (LAF) operations.
- Align Indian market operations with global best practices.
- Facilitate more efficient trading and risk management.
Scope of Implementation
Applies to:
- Call Money (Uncollateralised)
- Market Repo & Tri-Party Repo (Collateralised)
No changes made to:
- Government Securities (G-Secs) market
- Foreign exchange market
- Interest rate derivatives market
Background
- The RBI formed a Working Group chaired by Radha Shyam Ratho to review market timings.
- Stakeholder feedback was considered in the decision-making process.
Key Takeaways for Competitive Exams
- RBI extends trading hours for call money, market repo, and TREP segments to enhance liquidity and operational flexibility.
- Revised timings for call money market will be from 9:00 AM to 7:00 PM starting July 1, 2025.
- Market Repo and TREP segments will have new timings of 9:00 AM to 4:00 PM effective August 1, 2025.
- The changes aim to align Indian market operations with global best practices and improve risk management.
