The Hindu Business Line : Rupee steady; gilts in range

MUMBAI: Although pressure due to rising oil prices weakened the rupee to 45.92 against the dollar in the early session, the domestic currency closed more or less unchanged at 45.8650. Dollar sales by a large software company and public sector banks (PSBs) drove the rupee up. "A remittance of about $50 million was received by a software company, increasing dollar supply," said a dealer with a private sector bank.It is possible that the PSBs stepped in to sell dollars at the behest of the Reserve Bank of India (RBI), he added.

Forwards moved higher, reflecting the rising yields scenario as the six-month forward closed at 2.43 per cent (2.34 per cent) while the twelve-month forward ended at 2.10 per cent (1.97 per cent).

Bond prices finished barely unchanged from the previous closing levels as range-bound movement was witnessed, said bond traders.

Oil-related concerns led prices to fall by nearly 30-40 paise but some intermittent buying also led to incremental rises. The 10-year benchmark 7.38 per cent 2014 paper closed at a yield of 6.51 per cent, unchanged from previous close. The 11-year benchmark 7.38 per cent 2015 paper finished at Rs 107.10 with yield at 6.46 per cent, one basis point above the previous close.

Liquidity was comfortable with the call rates settling to close at 4.25-4.50 per cent before rising to 4.60 per cent during the day.

Under the LAF window, the RBI mopped up Rs 7,260 crore by way of 23 bids in one-day repo, while Rs 570 crore were absorbed in six-day repo through five bids.

In the CBLO market, 140 trades worth Rs 5,133.05 crore were transacted in the rate range of 4.4- 4.85 per cent.