Financial Daily from THE HINDU group of publications
Tuesday, Aug 30, 2005
Financial Daily from THE HINDU group of publications Tuesday, Aug 30, 2005 |
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Money & Banking
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Forex Rupee plunges; gilts bearish Our Bureau
MUMBAI: The rupee plunged to an eight-and-a-half month low against the greenback as the rising price of global crude sparked heavy dollar buying. The domestic currency opened at 43.78/79 and touched an intra-day low of 43.93. It ended the trade at 43.89, down by about 20 paise from previous closing of 43.6850/6950. A dealer at a private bank said that with the price of global crude touching a high of $70 per barrel there was a great deal of corporate demand for dollars. "The end of the month factor as well as the zooming price of crude led to a heavy demand for dollars from corporates (mainly oil companies)". Dealers said that there was some dollar selling by State- run banks at 43.93, which caused the rupee to end at 43.89. In the forward premia market, the 12-month ended at 0.6 per cent (0.67 per cent) and the 6-month closed at 0.51 per cent (0.59 per cent). In the bond market, prices fell by around 10 paise also due to the rising price of global crude. A dealer at a private bank said there was no buying interest in the market. Volumes were thin at Rs 1,200 crore. "While the price of crude is a worry, liquidity is comfortable. So, there is a degree of confusion in the market," he said. The 7.37-9 year-2014 paper opened at Rs 102.18 (7.02 per cent YTM) and closed at Rs 102.12 (7.04 per cent YTM), down from Friday's Rs 102.16 (7.03 per cent YTM). The 10.25-16 year-2021 paper opened at Rs 125.60(7.46 per cent YTM) and closed at Rs 125.50 (7.47 per cent YTM), lower than Friday's Rs 125.56 (7.46 per cent YTM). The 7.38-10 year 2015 benchmark paper was dealt at Rs 102.10 (7.08 per cent YTM). Call rates remained unchanged at 4.90-5.05 per cent. In the one-day reverse repo auction, the RBI received and accepted 35 bids amounting to Rs 22,255 crore. In the CBLO market, there were 214 trades for Rs 10,673.25 crore in the rate range of 4.75-5 per cent.
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