The Hindu Business Line : Rupee tad firmer; gilts range-bound

MUMBAI: In a lacklustre foreign exchange market on Monday, the rupee finished marginally higher at 45.0350/0450 against the dollar. The rupee had closed at 45.08/10 per dollar in the previous closing session.

"A range-bound movement was witnessed with the home currency in a narrow 5 paise band against the US currency," said a trader at a public sector bank.

Dealers said the rupee is likely to appreciate to 45 levels if major currencies such as euro continue to appreciate against the dollar.

Annualised premia on forwards softened yet again as export covering was on the rise, dealers said. The six-month forward closed at 1.40 per cent (1.72 per cent) while the twelve-month at 1.15 per cent (1.41 per cent).

Bond prices closed at more or less the previous closing levels even as liquidity tightness eased, dealers said.

Prices of government securities were in a narrow range of 30 paise. The 11-year benchmark 7.38 per cent 2015 paper touched a high of Rs 102.35 and settled lower at Rs 102.22. The yield on the paper went down to 7.05 per cent but closed higher at 7.07 per cent. The 7.55 per cent 2010 paper closed at Rs 103.50 after climbing Rs 103.70.

Meanwhile, inter-bank call rates eased to a range of 5.50-5.75 per cent. In the one-day reverse repo, RBI accepted a sole bid worth Rs 45 crore while in the repo auction, 4 bids aggregating Rs 1,025 crore were received and accepted.

In the CBLO market, 146 trades aggregating Rs 5,843.45 crore were transacted in the rate range of 5.30-5.75 per cent.

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