The Hindu Business Line : Rupee, bonds in tight range

MUMBAI: The rupee finished a shade stronger at 43.94/95 against the dollar on Monday, off the day's high at 43.86, on the back of foreign and trade related inflows. The currency had ended at 43.96/97 on Friday.

The rupee has been tracking other international currency majors in the recent sessions, said a dealer at a private sector bank. The weakness of the dollar against the Euro and other currencies is helping the rupee strengthen, he added.

"Volumes in the dollar rupee foreign exchange market have thinned to 30 per cent of previous week's volumes," said a dealer at a private sector bank. Forward premia rose following tightness of liquidity with the six-month forward ending at 2.25 per cent (2.11 per cent) and the one-year forward finishing at 1.65 per cent (1.48 per cent).

The bond market also saw a reduced activity with volumes dropping to nearly Rs 1,000 crore as prices closed a shade higher than the previous closing levels.

The 7.38 per cent 2015 paper ended at Rs 104.95 at a yield of 6.73 per cent while the 7.55 per cent 2010 paper finished at Rs 104.85 at a yield of 6.48 per cent.

Call rates were tighter moving between 6.00 and 6.10 per cent. In the one-day reverse repo auction, the RBI accepted all the 7 bids aggregating Rs 1,750 crore and in the one-day repo auction 12 bids worth Rs 5,315 crore were received and accepted.

In the CBLO market, 132 trades amounting to about Rs 4,500 crore were transacted.