The Hindu Business Line : Rupee slips; bonds steady

MUMBAI: The rupee finished at 45.1750/1850 against the dollar after appreciating to an intra-day high of 45.10 during the day. The currency had finished at its five-month high on Tuesday at 45.1650/1750 per dollar.

Bullish sentiment on the rupee coupled with a fall in oil prices and dollar inflows, both from foreign funds and exporters selling dollars, drove the domestic currency to the day's high. At this level, State-owned banks stepped up heavy dollar purchases, perhaps at the behest of the RBI. The six-month forward closed at 2.42 per cent (2.26 per cent) and the twelve-month at 2.00 per cent (1.86 per cent).

Bond prices closed at levels more or less unchanged from the previous closing levels after rising nearly 65 paise in medium term papers during the day.

Prices rose in the morning on speculation that the next auction of Government securities due between November 16 and 24 may be cancelled, dealers said. Expectation of a 25-basis point hike in the Fed rate brought the prices down.

The yield on 7.38 per cent 2015 paper dipped to 7.11 per cent before it rose to close at 7.19 per cent at a price of Rs Call rates remained tight as they closed in a range of 6.00- 6.25 per cent. In the one-day repo auction, RBI received and accepted 26 bids aggregating Rs 7,080 crore, while it accepted all three bids worth Rs 70 crore in the one-day reverse repo auction. In the CBLO market, 139 trades worth Rs 4,605.75 crore were transacted.