What are the instruments of money market in India?

What are the instruments of money market in India?

Types of Money Market Instruments in India

  • Treasury Bills. Treasury Bills are one of the most popular money market instruments.
  • Commercial Bills. Commercial bills, also a money market instrument, works more like the bill of exchange.
  • Certificate of Deposit.
  • Commercial Paper.
  • Call Money.

What are the instruments traded in money market?

Some of the instruments traded in the money market include Treasury bills, certificates of deposit, commercial paper, federal funds, bills of exchange, and short-term mortgage-backed securities and asset-backed securities.

What are the five money market instruments?

Some of the common money market instruments include Banker’s Acceptance, Treasury Bills, Repurchase Agreements, Certificate of Deposits and Commercial Papers.

What are the main types of money market instruments?

Instruments of the Money Market

  • Promissory Note: A promissory note is one of the earliest type of bills.
  • Bills of exchange or commercial bills.
  • Treasury Bills (T-Bills)
  • Call and Notice Money.
  • Inter-bank Term Market.
  • Commercial Papers (CPs)
  • Certificate of Deposits ( CD’s )
  • Banker’s Acceptance (BA)

What is money market instruments as per RBI?

The money market instruments consist of i) call (overnight) and short-notice (up to fourteen days) money, ii) term money, iii) commercial paper (CP), iv) certificates of deposit (CDs), v) money market mutual funds (MMMFs), vi) commercial bills and vii) Treasury Bills.

What are the features of money market instruments?

Features of Money Market It is market purely for short-term funds or financial assets called near money. It deals with financial assets having a maturity period up to one year only. It deals with only those assets which can be converted into cash readily without loss and with minimum transaction cost.

How does money market work in India?

Money Market is a segment of the financial market in India where borrowing and lending of short-term funds take place. The maturity of money market instruments is from one day to one year. In India, this market is regulated by both RBI (the Reserve bank of India) and SEBI (the Security and Exchange Board of India).

What are the features of Indian money market?

Features of the Indian Money Market:

  • Components of the Money Market:
  • Indigenous Markets:
  • Rates of Interest:
  • Volatile Call Money Market:
  • Organized and Unorganized Sectors:
  • Busy and Slack Seasons:
  • Dominance of Government Securities:
  • Underdeveloped Bill Market:

Who regulates the money market instruments in India?

The Reserve Bank
The Reserve Bank derives statutory powers to regulate market segments from specific provisions of the Reserve Bank of India Act, 1934. The prudential guidelines issued to eligible market participants form the broad regulatory framework for Government securities, money market and interest rate derivatives.

Who controls money market in India?

Explanation: Capital market in India is an important part of the financial system. The Indian Securities and Exchange Board (SEBI) regulates the capital market in India.

Who regulates money market in India?

RBI regulates the money market. The Money market is the market where the trading between banks and the financial institutions for short term loans i.e. for less than 364 days. Certificate of Deposit, Commercial papers, and treasury bills are few of the instruments of the money market.

Who is the most important constituent of Indian money market?

The RBI is the most important constituents of Indian money market. The organized sector is within the direct purview of RBI regulation. The unorganized sector comprises of indigenous bankers, money lenders and unregulated non-banking financial institutions.

Who is the largest regulator of Indian money market?

The RBI is the money market and the banking regulator in India.

How big is money market in India?

India: Markets

Reference Previous
Money Market Rate 09 Jun 2022 3.35
Stock Market Index 09 Jun 2022 54,892
Average Long-term Government Bond 08 Jun 2022 6.08
Treasury Bills (over 31 days) 08 Jun 2022 5.52

What is the structure of Indian money market?

The Indian monetary market has two broad categories – the organized sector and the unorganized sector. Organized Sector: This sector comprises of the governments, the RBI, the other commercial banks, rural banks, and even foreign banks. The RBI organizes and controls this sector.