Money rates fall

Press, 10 May 1982, Page 32

Money rates fall

The interest rate on banks’ transferable certificates of deposit came back to 18 per cent during the week, from 18.8 per cent the previous week, mainly because of “pressure from above,” Mr V. G. Duffy, of APA Discount Corporation, told “The Press.” The interest rate on 90-day commercial bills declined to around 17.9 per cent, he said. Some short-term money market dealers were still reasonably liquid, Mr Duffy said, but some were not, because — having written bills at what are now uneconomic rates, they were not disposing of these. Carrying more paper in their portfolios obviously takes a lot of cash. Interest rates offered to the investing public are still rising, with some finance houses advertising carded rates as high as 17.5 per cent for one year and 18 per cent for 18 months. Because of the inability to raise rates in the official short-term money market, more money is finding its way into the -unofficial money market, and the gap between the rates in the official and unofficial market appears to be widening.