Financial Daily from THE HINDU group of publications
Wednesday, Nov 27, 2002
Money & Banking
Re range-bound; gilts up
THE rupee ended on Tuesday at 48.21/22 against the dollar as compared to Monday's close of 48.20/21 in the forex market. The domestic unit was seen to be range-bound, with the currency having opened at 48.21.
"There was good supply of the greenback, which is expected to continue on Wednesday also,'' said a forex dealer.
Both foreign banks and private banks were seen buying dollars in the market, he said.
The rupee touched an intra-day high of 48.2025 and an intra-day low of 48.2250.
The forward premia were seen falling with six-month premium closing at 3.56 per cent (3.68 per cent) and the one-year premium ending at 3.58 per cent (3.69 per cent).
Bond prices went up on Tuesday, albeit marginally by 15-25 paise across maturities.
The 7.40 per cent 2012 paper closed at Rs 106.97 with a yield of 6.4059 per cent, as compared to earlier close of Rs 106.82. The 11.50 per cent 2011 paper ended at Rs 134.02 as compared to Monday's close of Rs 133.83.
On the longer end, the 10.18 per cent 2026 paper was seen to be active with the price closing at Rs 134.10 as against earlier close of Rs 133.85.
"There was a lot of churning of portfolio witnessed today,'' said a dealer in a primary dealer.
With the mad rush of prices gaining by 50 paise to Re 1 having come to a halt, dealers expect the liquidity fuelled rally to continue at a much slower pace.
Players were seen selling the longer end papers and reducing their risk exposure by substituting it with shorter end papers, said a dealer.
In the inter-bank call money market, the call rates closed comfortably at 4.75-5.25 per cent.
In the LAF, the RBI received 42 bids worth Rs 11,415 crore, all of which was accepted at the repo rate of 5.50 per cent.
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